CH.8 CW & HW

External factors that cause the achievement of company goals are the

industry price and cost structure.

The master budget is a static budget because it

is geared to only one level of production and sales.

Which of the following is not an "operating" budget?

capital budget

The selling, general, and administrative expense budget is based on the ____ budget.

sales

Strategic planning is

stating and establishing long-term goals.

Budgeted production for a period is equal to

End. Inv + Sales - Beg. Inv.

An annual budget is an example of a strategic plan.

False

In a mfg org, the cash budget is prepared immediately after the sales budget.

False

Operational management should be directly involved with the strategic planning of an org.

False

Strategic planning is focused on short-term goals of less than 5 years.

False

The amount of raw materials that must be purchased can be computed by: Beg. Inventory + Materials required - End. Inventory.

False

The financial budget is prepared before the operating budget.

False

Depreciation on the production equipment would appear in which of the following budgets?

Manufacturing overhead budget.

An annual budget is an example of a single use tactical plan.

True

Most tactical plans are single use plans.

True

The effect of capital expenditures on the master budget is reflected through cash payments made for acquisition of capital assets.

True

The financial budget is prepared after the operating budget.

True

The first stage in the budgeting process is the preparation of a sales budget.

True

Top management should be directly involved in strategic planning for an organization.

True

A pro forma financial statement is

a projected or budgeted financial statement

Tactical planning usually involves which level of mgt?

middle and top

Which of the following items would not be found in the financing section of the cash budget?

payment of accounts payable