ACCT chapter 8💕
The calculation of unit product cost requires information from the
manufacturing overhead budget
Each component of a(n)______ budget is based on or provides input for another
master
Which of the following budgets are needed to calculate unit product costs?
Direct materials budget Direct labor budget Manufacturing overhead budget
Which of the following statements is true?
Understanding the interrelationships of individual budgets is the key to developing a master budget.
The number of units needed to satisfy sales and provide the desired ending inventory is shown on the _____ budget.
production
To calculate the cash balance before financing on the cash budget, add the
beginning cash balance to the budgeted cash receipts and deduct budgeted cash payments
A detailed document that identifies resources and expenditures that will be required over a limited time (typically a year) is a(n)______.
budget
Company objectives are translated into financial terms in a(n)______
budget
The final step in the master budgeting process is to prepare the
budgeted balance sheet
Total sales on the sales budget equal budgeted unit sales multiplied by_____
budgeted sales price per unit
The operating budgets feed directly into the
cash budget
Budgets ______.
communicate management's plan throughout the organization
Managers look back to determine whether goals were met and take corrective action to improve future results during the ______ part of the cycle.
controlling
The sections of the cash budget are ______.
disbursements collections financing
True or false: Using a participative approach to budgeting is less likely to motivate employees than using a top-down approach.
false
The sections of the cash budget are
financing disbursements collections
Managers put plans into action as part of _____.
implementing
All costs of production other than direct materials and direct labor are shown on the ______ budget.
manufacturing overhead
Davidson Corporation's master budget shows expected direct labor cost of $90,000 for the month of May. During May, the company's expected sales equal 12,000 units and expected production is 15,000 units. If each unit requires 1/2 hour of direct labor, the budgeted direct labor rate is $
$12 per hour
Sperling Company's master budget shows expected sales of 10,000 units and expected production of 11,000 units for the month of March. Each unit requires 1/2 hour of direct labor. The direct labor rate is $15.00 per hour. Calculate the expected total direct labor cost for the month of March.
$82,500
The direct materials budget directly relies on the _____ budget.
production
Company objectives are translated into financial terms in a(n)
Budget
Which of the following budgets shows the company's planned profit?
Budgeted income statement
What number does the raw materials budget take directly from the production budget?
Budgeted production
Which of the following is NOT included on a budgeted cash payments budget?
Production in units
Which of the following is needed to prepare a sales budget?
The budgeted number of units to be sold
To calculate the direct labor requirement for each quarter
multiply the number of direct labor hours required per unit times the number of units to be produced
The pro-forma income statement is based on the combined ______ budgets.
operating
The sales, production, and purchases budgets are all________ budgets.
operating
Advantages of budgeting include Blank______.
providing lead time to solve potential problems forcing managers to think about and plan for the future promoting cooperation and coordination among different areas within the organization providing benchmarks for evaluating performance
The production budget is based upon the_______ budget.
sales
When creating the master budget, the ______ budget is prepared first
sales
Budgeted expenses for costs related to selling the product and managing the business are shown on the
selling and administration budget
When an organization uses a top-down approach to budgeting, Blank______.
the budget is imposed on lower levels of the organization top management sets the budget
When it comes to preparing budgets,
the budgets needed depend upon the type of firm
Budgeted fixed manufacturing overhead per unit is computed by dividing budgeted fixed manufacturing overhead cost by budgeted production units for
the entire year
The operating budgets feed directly into the_______ ________
which then feeds directly into the budget balance sheet