ACC 208 CH 6 and 8 Smartbook problems
An integrated business plan that formally lays out the company's goals is called the ______ budget.
master
The amount of goods to be acquired from suppliers during the period is shown on the _______ budget.
merchandise purchases
Master budget schedules ______. (select all that apply) a) answer several key questions for a company b) are based on estimates and assumptions c) may be prepared in any order
a) answer several key questions for a company b) are based on estimates and assumptions
A company must make a volume trade-off decision when they_____ (select all that apply) a) do not have enough capacity to satisfy all product demand b) have excess capacity that is not currently being utilized c) must trade off units of one product for units of another
a) do not have enough capacity to satisfy all product demand c) must trade off units of one product for units of another
budgets _____ (select all that apply) a) force managers to think about and plan for the future b) and the budgeting process can uncover potential bottlenecks before they occur c) coordinate the activities of the entire organization by integrating the plans of its various parts d) provide each department with the same amount of money to spend, so that all departments are treated fairly e) define goals and objectives that can serve as benchmarks for evaluating subsequent performance
a) force managers to think about and plan for the future b) and the budgeting process can uncover potential bottlenecks before they occur c) coordinate the activities of the entire organization by integrating the plans of its various parts e) define goals and objectives that can serve as benchmarks for evaluating subsequent performance
which of the following are directly based on information from the sales budget? (select all that apply) a) selling and administrative expense b) direct materials c) production d) manufacturing overhead
a) selling and administrative expense c) production
A company is considering buying a component part that they currently make using some existing equipment. Relevant costs to this sourcing decision include_____(select all that apply) a) variable overhead b) allocated general overhead c) equipment depreciation charges d) outside purchase price
a) variable overhead d) outside purchase price
when considering accepting a special order, _____. (Select all that apply) a) incremental revenue should be equal to incremental cost b) there must be idle capacity c) opportunity costs should never be considered d) normal sales must not be affected
b) there must be idle capacity d) normal sales must not be affected
the machine or process that is limiting overall output is called
bottleneck
the step that limits total output because it has the smallest capacity is called a constraint or ______.
bottleneck
which of the following is not found in the financing section of the cash budget?
cash deficiency
On the cash budget, what is subtracted from total cash available to find the cash excess or deficiency?
cash disbursement
A limited resource of some type that restricts the company's ability to satisfy demand is a _____.
constraint.
a business segment should only be dropped if a company can avoid more in fixed costs than it gives up in _____.
contribution margin
The number of working hours required to satisfy the production budget is shown on the ________ ________ budget.
direct labor
in a manufacturing company, the ____ ____ budget details the raw materials that must be purchased to fulfill the production budget and to provide for adequate inventories.
direct material
to maximize total contribution margin when a constraint resource exists, produce the products with the ______.
highest contribution margin per unit of the constrained resource
what number does the direct materials budget take directly from the production budget?
required production.
Because all other parts of the budget depend on it, if the ______ budget is inaccurate, the rest of the budget will be inaccurate.
sales
a one-time sale that is not considered part of the company's normal ongoing business is referred to as a _____ ______ decision.
special order
when considering decision alternatives, both relevant and irrelevant costs are included when using the _____ cost approach.
total
When a constraint exists, companies need to focus on maximizing ______.
total contribution margin
when demand for products exceeds the production capacity, a _____ decision must be made.
volume trade-off
A special order should be accepted ______.
when the incremental revenue from the special order exceeds the incremental costs of the order
When a resource, such as space in the factory, has no alternative use, its opportunity cost is ______.
zero
Product ABC has a contribution margin per unit of $10.00. Each unit of ABC requires 5 minutes of machine time. Product XYZ has a contribution margin per unit of $15.00 and each unit requires 10 minutes of machine time. If the company's constraint is machine hours, to maximize profit, they should first fill the demand for Product ______.
ABC
potential advantages of dropping a product line or other segment include ____. (select all that apply) a) an overall increase in net operating income b) an overall decrease in other product line sales c) avoiding more fixed costs than the company loses in contribution margin d) increasing relevant costs that the company incurs
a) an overall increase in net operating income c) avoiding more fixed costs than the company loses in contribution margin
in a manufacturing company, which budget is used as the basis for creating the direct materials budget, the direct labor budget, and the manufacturing overhead budget?
production budget
operating budgets generally cover a _____ period.
one-year
Developing goals and preparing various budgets to achieve those goals is part of the _____ process.
planning
a merchandising company prepares a merchandise purchasing budget instead of a _____ budget.
production
a merchandising company prepares a merchandise purchasing budget instead of a ______ budget.
production
in a manufacturing company, the _____ budget is prepared right after the sales budget.
production
the direct materials budget directly relies on the _____ budget.
production