Managerial Accounting Practice Exam 3 pt.2

Which of the following budgets can be used for control?

a. Budgeted income statement b. Selling and administrative expense budget c. Production budget d. Cash budget ***e. All of these choices are correct.

Which of the following is true of a continuous budget?

a. It forces managers to plan ahead constantly.

Which of the following is true of a static budget?

a. It provides expected cost for a given level of activity.

Depreciation expense on sales equipment appears in a separate line on which of the following budgets?

a. Selling and administrative expenses budget

Which of the following is used to calculate total variable overhead variance where VOH = Variable Overhead, SVOR = Standard Variable Overhead Rate, SH = Standard Hour Allowed, and AH = Actual Direct Labor Hours Used?

a. Total VOH Variance = Actual VOH - SVOR × SH

In preparing the overhead budget, many companies use

a. a unit-based driver such as direct labor hours.

Which of the following could be considered a segment?

a. product-line b. sales territory c. division ***d. All of these choices are correct.

Which of the following is used to calculate the fixed overhead volume variance?

b. Budgeted Fixed Overhead - Applied Fixed Overhead

Which of the following is a key point considered in a special order decision?

b. The estimated benefits associated with the special order

The variable overhead efficiency variance claims to measure

b. changes in variable overhead costs because of the efficient (inefficient) use of the cost driver.

The budget that describes how many units must be produced in order to meet sales needs and ending inventory objectives is the

b. production budget.

Which of the following formulas calculates the total fixed overhead (FOH) variance?

c. Actual Fixed Overhead - Applied Fixed Overhead

Which of the following is true concerning the materials price variance?

c. It is the difference between the actual and standard unit price of an input multiplied by the number of inputs purchased.

Which of the following involves choosing between alternatives with an immediate or limited time frame in mind?

c. Short-run decision making

Which of the following is not a step in the decision-making model?

c. determine costs and benefits for both feasible and unfeasible alternatives

Which of the following is an operating budget?

d. Budgeted income statement

Which of the following appears on a budgeted balance sheet?

d. Estimated finished goods inventory

Which of the following is true of participative budgeting?

d. It gives an opportunity to build slack into the budgets.

Which of the following formulas is used to compute the units to be produced?

d. Units to Be Produced = Expected Unit Sales + Units in Desired Ending Inventory - Units in Beginning Inventory

The ____ is the person responsible for directing and coordinating the organization's overall budget process.

d. budget director

Budgeted operating income includes

d. budgeted cost of goods sold.

The ending finished goods inventory budget supplies information needed for the

d. cost of goods sold budget.

Lambert Company purchased $140,000 of goods in September and expects to purchase $130,000 of goods in October. Lambert typically pays for 20% of purchases in the month of purchase and 80% in the following month. Every month, Lambert must make the following payments: Rent $5,000 Wages 14,000 Utilities 3,000 Telephone 400 Loan on equipment 1,200 In mid-October, Lambert expects to buy a new computer for $4,500 using the company credit card. Typically, the credit card bill is paid in full in the following month. September credit card purchases totaled $6,000. What is Lambert's expected cash disbursement in October for purchases of goods? a. $140,000

e. $138,000

Which of the following is not true concerning direct materials variances?

e. The materials price variance always uses the actual quantity of materials used rather than the actual quantity of materials purchased.

In budgeting direct labor hours for the coming year, it is important to

e. multiply production in units by the direct labor hours per unit.