Chapter 9 Quiz

Mockingbird Company expects to sell 5,000 bird perches in January and 7,500 in February for $4 each. What will be the total sales revenue reflected in the sales budget for those months?

January 20,000 and February 30,000

Which is an advantage of zero-based budgeting?

Zero-based budgeting forces managers to justify each dollar in the budget to ensure that some expenses are lower in a current year compared to what they were in previous years.

The ______ budget is a component in a financial budget

cash

Strategic planning is beneficial because the organization can:

establish long term goals that extend 5-10 years into the future

Which is a potential disadvantage of participative budgeting?

managers may build slack into the budget

"The comprehensive budget" is best described by which of the following terms?

master budget

On the direct materials budget, the total quantity of direct materials to purchase is computed as:

quantity needed for production + desired end inventory of DM - beginning inventory of DM

The _______ budget begins with the number of units to be sold

sales

The ________ is a plan that shows the units to be sold and the projected selling price and is also the starting point in the budgeting process

sales budget

Dallas corporation had beginning inventory of 18,700 units and expects sales of 80,000 units during the year. Desired ending inventory is 18,400 units. How many units should Dallas Corporation produce?

79,700