Managerial Accounting Questions Exam 3
the master budget
The comprehensive set of budgets that serves as a company's overall financial plan is commonly known as
actual results can be compared
a budget serves as a benchmark against which
cash budget
a company's expected receipts from sales and planned disbursements to pay bills is commonly called a
capital budget
a company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a
financial budget
a company's plan for the issuance of stock or incurrence of debt is commonly called a
sales budget
a manufacturing firm would begin preparation of its master budget by constructing a
false
a standard cost card shows what the company should spend to produce a single unit of product based on expected production for the coming period
is based on one anticipated activity level
a static budget
false
companies develop a set of operating budgets to project cash flow and likely cash shortfalls and/or surpluses
activity levels
flexible budgets reflect a company's anticipated costs based on variations in
false
in an activity-based flexible budget, each overhead item has the same cost driver, identified by flexible overhead budget for that cost item
purchasing, production
the _______________ department would generally begin an initial investigation of an unfavorable material price variance and the ____________ department would generally begin an initial investigation of an unfavorable materials quantity variance
true
the activity-based flexible budget provides a more accurate benchmark against which to compare actual costs than does a conventional flexible budget
direct materials price variance
the difference between the actual price and the standard price multiplied by the actual quantity of materials purchased, is the
production budget
the direct materials budget is prepared using which budget's information
sales budget
the first step in developing a master budget is always the creation of which of the following
purchasing manager
the individual generally responsible for the direct-material price variance is the
adding budgeted sales to the desired ending inventory and subtracting beginning inventory
the units required in production each period are computed by which of the following methods
unfavorable variance
this variance is the difference involving spending more or using more than the standard amount
false
variances are computed by taking the difference between the product cost and standard cost
more qualified workers
what are some reasons for a material quantity variance
the static budget is prepared for a single level of activity, while a flexible budget is adjusted for different activity levels
what is the primary difference between a static budget and a flexible budget
sales budget, selling and administrative budget, budgeted income statement, budgeted balance sheet
what is the proper sequencing of the following budgets
planning , performance evaluation, coordination of activities
what managerial functions that are commonly associated with budgeting
when the actual quantity used is greater than the standard quantity
when is the material price variance unfavorable
when the actual quantity used is less than the standard quantity
when is the material quantity variance favorable
flexible budget
which budgets evaluates the results of operations at the actual level of activity
all of the listed choices are correct
which of the following could be found on a flexible overhead budget
hiring unqualified workers
which of the following is a possible cause of an unfavorable labor efficiency variance
purchasing substandard material
which of the following is a possible cause of an unfavorable material quantity variance
standard cost
which of the following is a predetermined estimated cost that can be used in the calculation of a variance
cost drivers
which of the following should have the strongest cause and effect relationship with overhead costs
FPMs have become less popular in recent years because of computers and spreadsheets
which of the following statements about financial planning models (FPMs) is (are) false
both normal and standard costing
which systems use a predetermined overhead rate
use of standard hours versus actual hours
with respect to overhead, what is the difference between normal costing and standard costing