ACT Ch.9

B II only

. Consider the following statements about budget administration: I. The budgeting process is a very formal process in all organizations regardless of an organization's size.II. The budget manual is prepared to communicate budget procedures and deadlines to employees throughout an organization.III. Effective internal control procedures require that the budget director be an individual other than the controller.Which of the above statements is (are) true? A. I only.B. II only.C. III only.

A. 41,485 pairs

. What is Overton's estimated sales in units for next year? A. 41,485 pairs.B. 38,300 pairs.C. 40,000 pairs.D. 40,685 pairs.E. None of the answers is correct.

None of the above

43. Activity-based budgeting: A. begins with a forecast of products and services to be produced, and customers served.B. ends with a forecast of products and services to be produced, and customers served.C. parallels the flow of analysis that is associated with activity-based costing.D. reverses the flow of analysis that is associated with activity-based costing.E. None of the answers is correct.

B, 174,000 170,000

76. Harrington makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for June, July, and August were $120,000, $160,000, and $220,000, respectively, what were the firm's budgeted collections for August and the company's budgeted receivables balance on August 31? August Collections August 31 Receivables Balance A. $162,000 $182,000 B. $174,000 $170,000 C. $190,000 $154,000 D. $262,000 $ 82,000 E. Some other combination of figures not listed above.

A actual results can be compared

A budget serves as a benchmark against which: A. actual results can be compared. B. allocated results can be compared. C. actual results become inconsequential. D. allocated results become inconsequential. E. cash balances can be compared to expense totals.

B. 2-1-3

A company that uses activity-based budgeting performs the following: 1—Plans activities for the budget period.2—Forecasts the demand for products and services as well as the customers to be served.3—Budgets the resources necessary to carry out activities.Which of the following denotes the proper order of the preceding activities? A. 1-2-3.B. 2-1-3.C. 2-3-1.D. 3-1-2.E. 3-2-1.

E. cash budget.

A company's expected receipts from sales and planned disbursements to pay bills is commonly called a: A. pro-forma budget.B. master budget.C. financial budget.D. profit plan.E. cash budget.

E. Capital budget

A company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a: A. pro-forma budget.B. master budget.C. financial budget.D. profit plan.E. capital budget.

C-financial budget

A company's plan for the issuance of stock or incurrence of debt is commonly called a: A. pro-forma budget.B. master budget.C. financial budget.D. profit plan.E. capital budget.

C. the company's product costing policy.

A company's sales forecast would likely consider all of the following factors except: A. past sales levels and trends.B. the company's intended pricing policy.C. the company's product costing policy.D. market research studies.E. planned advertising and promotions.

D. top management's attitude toward decentralized operating structures.

A company's sales forecast would likely consider all of the following factors except: A. political and legal events.B. advertising and pricing policies.C. general economic and industry trends.D. top management's attitude toward decentralized operating structures.E. competition.

E. a detailed plan against which actual results can be compared.

A formal budget program will almost always result in: A. higher sales. B. more cash inflows than cash outflows. C. decreased expenses. D. improved profits. E. a detailed plan against which actual results can be compared.

D. The production budget

A manufacturer develops budgets for the direct materials, direct labor, and overhead that will be required in the production process from which of the following? A. The selling and administrative expenses budget. B. The budget for merchandise purchases. C. The sales budget. D. The production budget. E. The cash budget.

A. sales budget.

A manufacturing firm would begin preparation of its master budget by constructing a: A. sales budget.B. production budget.C. cash budget.D. capital budget.E. set of pro-forma financial statements.

A. 45,000.

An examination of Hyong Corporation's inventory accounts revealed the following information: Raw materials, June 1: 46,000 unitsRaw materials, June 30: 51,000 unitsPurchases of raw materials during June: 185,000 unitsHyong's finished product requires four units of raw materials. On the basis of this information, how many finished products were manufactured during June? A. 45,000.B. 47,500.C. 57,750.D. 70,500.E. None of the answers is correct

E. all of the answers are correct.

An organization's budgets will often be prepared to cover: A. one month.B. one quarter.C. one year.D. periods longer than one year.

B 1,949,400

Assume that Toy Craft makes ragdolls. Each ragdoll requires 12 square feet of fabric. If the number of dolls to be produced during the quarter is 19,000, the desired ending inventory of fabric is 11,400 square feet, the beginning inventory of fabric is 22,800 square feet, and the cost of the fabric is $9 per square foot, what is the total cost of fabric purchases? A. $216,600 B. $1,949,400 C. $2,154,600

B. 255,000

Barre plans to sell 5,000 units each quarter next year. During the first two quarters each unit will sell for $12; during the last two quarters the sales price will increase $1.50 per unit. What is Barre's estimated sales revenue for next year? A. $240,000.B. $255,000.C. $270,000.D. $244,000.

C. 264,000.

Blaylock plans to sell 85,000 units of product no. 794 in May, and each of these units requires three units of raw material. Pertinent data follow. Product No. 794 Raw Material Actual May 1 inventory 11,000 units 29,000 units Desired May 31 inventory 17,000 units 20,000 units On the basis of the information presented, how many units of raw material should Blaylock purchase for use in May production? A. 228,000.B. 246,000.C. 264,000.D. 282,000.E. None of the answers is correct

C. Production volume and management judgment

Chong Corporation has a highly automated production facility. Which of the following correctly shows the two factors that would likely have the most direct influence on the company's manufacturing overhead budget? A. Sales volume and labor hours.B. Contribution margin and cash payments.C. Production volume and management judgment.D. Labor hours and management judgment.E. Management judgment and indirect labor cost.

C. Budget padding will likely be a greater problem at Company B.

Company A uses a heavily participative budgeting approach whereas at Company B, top management develops all budgets and imposes them on lower-level personnel. Which of the following statements is false? A. A's employees will likely be more motivated to achieve budgetary goals than the employees of Company B. B. B's employees may be somewhat disenchanted because although they will be evaluated against a budget, they really had little say in budget development.C. Budget padding will likely be a greater problem at Company B. D. Budget preparation time will likely be longer at Company A. E. Ethical issues are more likely to arise at Company A, especially when the budget is used as a basis for performance appraisal.

E

Consider the following statements about budgetary slack: I. Managers build slack into a budget so that they stand a greater chance of receiving favorable performance evaluations.II. Budgetary slack is used by managers to guard against uncertainty and unforeseen events.III. Budgetary slack is used by managers to guard against dollar cuts by top management in the resource allocation process.Which of the above statements is (are) true? A. I only.B. II only.C. I and II.D. II and III.E. I, II, and III.

E

Consider the following statements about companies that are involved with international operations: I. Budgeting for these firms is often very involved because of fluctuating values in foreign currencies.II. Multinational firms may encounter hyperinflationary economies.III. Such organizations often face changing laws and political climates that affect business activity.Which of the above statements is (are) true? A. I only.B. III only.C. I and II.D. II and III.E. I, II, and III.

C. 2040

Cycle Sporting Goods sells bicycles throughout the northeastern United States. The following data were taken from the most recent quarterly sales forecast: Expected Sales End-of Month Target Inventory July 1,800 units 210 units August 1,950 units 300 units September 1,880 units 270 units On the basis of the information presented, how many bicycles should the company purchase in August? A. 1,860.B. 1,950.C. 2,040.D. 2,250.

D. 197,000

Dalton Industries makes all purchases on account, subject to the following payment pattern:Paid in the month of purchase: 30%Paid in the first month following purchase: 60%Paid in the second month following purchase: 10%If purchases for January, February, and March were $200,000, $180,000, and $230,000, respectively, what were the firm's budgeted payments in March? A. $69,000.B. $138,000.C. $177,000.D. $197,000.E. None of the answers is correct.

D 9,900

Elon & Company had 3,000 units in finished-goods inventory on December 31. The following data are available for the upcoming year: January February Units to be produced 9,400 10,200 Desired ending finished-goods inventory 2,500 2,100 The number of units the company expects to sell in January is: A. 6,900.B. 8,900.C. 9,400.D. 9,900.E. 11,900.

D. budgeted balance sheet

End-of-period figures for accounts receivable and payables to suppliers would be found on the: A. cash budget.B. budgeted schedule of cost of goods manufactured.C. budgeted income statement.D. budgeted balance sheet.E. budgeted statement of cash flows.

E. A cash receipts budget of flying consumers

For an airline, which of the following would not be an operational budget? A. A labor budget for flight crew. B. A budget of planned air miles to be flown. C. A materials budget for aircraft parts. D. A fuel budget. E. A cash receipts budget of flying consumers.

A. 18,000

Gallonte Inc. began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for April? A. $18,000.B. $21,000.C. $60,000.D. $65,000.E. None of the answers is correct.

D. 75,000

Gallonte Inc. began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for June? A. $21,000.B. $60,000.C. $69,000.D. $75,000.E. None of the answers is correct.

B. 60,000

Gallonte Inc. began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for May? A. $21,000.B. $60,000.C. $69,000.D. $75,000.E. None of the answers is correct.

c. 153000

Gallonte Inc. began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for the quarter? A. $121,000.B. $140,000.C. $153,000.D. $175,000.

A-identify a company's most profitable products.

Generally speaking, budgets are not used to: A. identify a company's most profitable products. B. evaluate performance. C. create a plan of action. D. assist in the control of profit and operations.E. facilitate communication and coordinate activities

D. 50,600

Houseman, Inc. anticipates sales of 50,000 units, 48,000 units, 51,000 units and 50,000 units in July, August, September and October, respectively. Company policy is to maintain an ending finished-goods inventory equal to 40% of the following month's sales. On the basis of this information, how many units would the company plan to produce in September? A. 46,800.B. 49,200.C. 49,800.D. 50,600.E. None of the answers is correct.

B.49,200

Houseman, Inc. anticipates sales of 50,000 units, 48,000 units, and 51,000 units in July, August, and September, respectively. Company policy is to maintain an ending finished-goods inventory equal to 40% of the following month's sales. On the basis of this information, how many units would the company plan to produce in August? A. 48,000.B. 49,200.C. 49,800.D. 50,600.E. None of the answers is correct.

B. 49,200.

Houseman, Inc. anticipates sales of 50,000 units, 48,000 units, and 51,000 units in July, August, and September, respectively. Company policy is to maintain an ending finished-goods inventory equal to 40% of the following month's sales. On the basis of this information, how many units would the company plan to produce in July? A. 46,800.B. 49,200.C. 49,800.D. 52,200.

D. 25,000 square feet.

Hsu plans to sell 40,000 units of product no. 75 in June, and each of these units requires five square feet of raw material. Pertinent data follow. Product No. 75 Raw Material Actual June 1 inventory 5,500 18,000 square feet Estimated June 30 inventory 4,300 ? square feet If the company purchases 201,000 square feet of raw material during the month, the estimated raw-material inventory on June 30 would be: A. 11,000 square feet.B. 13,000 square feet.C. 23,000 square feet.D. 25,000 square feet.

B under, over

If a manager builds slack into a budget, how would that manager handle estimates of revenues and expenses? Revenues Expenses A. Underestimate Underestimate B. Underestimate Overestimate C. Overestimate Underestimate D. Overestimate Overestimate E. Estimate correctly Estimate correctly

C. 32,950

Maki plans to sell 10,000 units of a particular product during July, and expects sales to increase at the rate of 10% per month during the remainder of the year. The June 30 and September 30 ending inventories are anticipated to be 1,100 units and 950 units, respectively. On the basis of this information, how many units should Maki purchase for the quarter ended September 30? A. 31,850.B. 32,150.C. 32,950.D. 33,250.

B 20,600

Marvel Woodcraft makes furniture. Marvel's expected sales are 20,000 bookcases for the quarter. The company begins the quarter with inventory of 3,000 bookcases and wants to have enough finished bookcases on hand at the end of the quarter to provide for 15% of the next quarter's expected sales of 24,000 bookcases. Based on this information, how many bookcases need to be produced during the quarter? A. 3,600 B. 20,600 C. 21,000 D. 4,000

B. 2,060,000

Marvel Woodcraft makes furniture. Marvel's expected sales are 20,000 bookcases for the quarter. The company begins the quarter with inventory of 3,000 bookcases and wants to have enough finished bookcases on hand at the end of the quarter to provide for 15% of the next quarter's expected sales of 24,000 bookcases. Ignoring any beginning inventory, if 50 board feet are required for each bookcase and the wood costs $2 per board foot, how much will Marvel pay for the bookcases it needs produce during the quarter? A. $360,000 B. $2,060,000 C. $2,600,000 D. $600,000

B. Retail outlet sales commissions.

Miracle Enterprises sells electronics in retail outlets and on the Internet. It uses activity-based budgeting in the preparation of its selling, general, and administrative expense budget. Which of the following costs would the company likely classify as a unit-level expense on its budget? A. Media advertising.B. Retail outlet sales commissions.C. Salaries of web-site maintenance personnel.D. Administrative salaries.E. Salary of the sales manager employed at store no. 23.

A. $195,840.

Nevis Motors manufactures a product requiring 0.5 ounces of platinum per unit. The cost of platinum is approximately $360 per ounce; the company maintains an ending platinum inventory equal to 10% of the following month's production usage. The following data were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 The cost of platinum to be purchased to support August production is: A. $195,840.B. $198,000.C. $200,160.D. $391,680.E. None of the answers is correct.

B. 183,075

Nevis' production data for a new deluxe product were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 In addition, Nevis produces 5,000 units a month of its standard product. It takes two direct labor hours to produce each standard unit and 2.25 direct labor hours to produce each deluxe unit. Nevis' cost per labor hour is $15. Direct labor cost for September would be budgeted at: A. $187,125.B. $183,075.C. $194,750.D. $197,075.

A. $187,125.

Nevis' production data for a new deluxe product were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 In addition, Nevis produces 5,000 units a month of its standard product. It takes two direct labor hours to produce each standard unit and 2.25 direct labor hours to produce each deluxe unit. Nevis' cost per labor hour is $15. Direct labor cost for August would be budgeted at: A. $187,125.B. $194,750.C. $197,107.D. $183,250.E. None of the answers is correct.

A. 183,750

Nevis' production data for a new deluxe product were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 In addition, Nevis produces 5,000 units a month of its standard product. It takes two direct labor hours to produce each standard unit and 2.25 direct labor hours to produce each deluxe unit. Nevis' cost per labor hour is $15. Direct labor cost for July would be budgeted at: A. $183,750.B. $187,125.C. $189,125.D. $194,750.E. None of the answers is correct.

D. 553,950

Nevis' production data for a new deluxe product were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 In addition, Nevis produces 5,000 units a month of its standard product. It takes two direct labor hours to produce each standard unit and 2.25 direct labor hours to produce each deluxe unit. Nevis' cost per labor hour is $15. Direct labor cost for the quarter would be budgeted at: A. $519,075.B. $533,125.C. $547,750.D. $553,950.E. None of the answers is correct.

C. 33,000

Nevis' production data for one of its products were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 If it takes two direct labor hours to produce each unit and Nevis' cost per labor hour is $15, direct labor cost for August would be budgeted at: A. $16,500.B. $31,200.C. $33,000.D. $34,800.E. None of the answers is correct.

D. Services to be provided

Nonprofit organizations begin their budgeting process with: A. a sales budget.B. anticipated funding.C. proforma financial statements.D. services to be provided.E. a cash budget

B. 46,000

Parvis makes all sales on account, subject to the following collection pattern: 20% are collected in the month of sale; 70% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for October, November, and December were $70,000, $60,000, and $50,000, respectively, what was the budgeted receivables balance on December 31? A. $40,000.B. $46,000.C. $49,000.D. $59,000.

B. 4500 increase

Rainbow, Inc. began operations on January 1 of the current year with a $12,000 cash balance. Forty percent of sales are collected in the month of sale; 60% are collected in the month following sale. Similarly, 20% of purchases are paid in the month of purchase, and 80% are paid in the month following purchase. The following data apply to January and February: January February Sales $35,000 $55,000 Purchases 30,000 40,000 Operating expenses 7,000 9,000 If operating expenses are paid in the month incurred and include monthly depreciation charges of $2,500, determine the change in Rainbow's cash balance during February. A. $2,000 increase.B. $4,500 increase.C. $5,000 increase.D. $7,500 increase.

B. rolling budget.

Salizar Corporation is budgeting its equipment needs on an on-going basis, with a new quarter being added to the budget as the current quarter is completed. This type of budget is most commonly known as a: A. capital budget.B. rolling budget.C. revised budget.D. pro-forma budget.E. financial budget.

A, 40,600

Terrence Corporation plans to sell 41,000 units of its single product in March. The company has 2,800 units in its March 1 finished-goods inventory and anticipates having 2,400 completed units in inventory on March 31. On the basis of this information, how many units does Terrence plan to produce during March? A. 40,600.B. 41,400.C. 43,800.

A. the final portion of the master budget.

The budgeted income statement, budgeted balance sheet, and budgeted statement of cash flows comprise: A. the final portion of the master budget.B. the depiction of an organization's overall actual financial results.C. the first step of the master budget.D. the portion of the master budget prepared after the sales forecast and before the remainder of the operational budgets.E. the second step of the master budget.

C. a master budget.

The comprehensive set of budgets that serves as a company's overall financial plan is commonly known as: A. an integrated budget.B. a pro-forma budget.C. a master budget.D. a financial budget.E. a rolling budget.

B. budgetary slack

The difference between the revenue or cost projection that a person provides, and a realistic estimate of the revenue or cost, is called: A. passing the buck.B. budgetary slack.C. false budgeting.D. participative budgeting.E. resource allocation processing.

A. Raw materials required for production + desired ending inventory of raw material = Total raw material required - expected beginning inventory of raw material = Raw material to be purchased.

The direct-material budget shows the number of units and the cost of material to be purchased and used during a budget period. Which of the following formulas is this schedule based on? A. Raw materials required for production + desired ending inventory of raw material = Total raw material required - expected beginning inventory of raw material = Raw material to be purchased. B. Raw materials required for production - desired ending inventory of raw material = Total raw material required + expected beginning inventory of raw material = Raw material to be purchased. C. Total raw material required + Raw materials required for production = desired ending inventory of raw material = Raw material to be purchased. D. Raw material to be purchased + expected beginning inventory of raw material = Desired ending inventory of raw material x cost per unit = Raw materials required for production. E. Raw material required for production ÷ [(expected beginning inventory of raw material + desired ending inventory of raw material) /2] = Raw material to be purchased.

c

The following events took place when Managers A, B, and C were preparing budgets for the upcoming period: I. Manager A increased property tax expenditures by 2% when she was informed of a recent rate hike by local authorities.II. Manager B reduced sales revenues by 4% when informed of recent aggressive actions by a new competitor.III. Manager C, who supervises employees with widely varying skill levels, used the highest wage rate in the department when preparing the labor budget. Assuming that the percentage amounts given are reasonable, which of the preceding cases is (are) an example of building slack in budgets? A. I only.B. II only.C. III only.D. I and II.

C. $674,000.

The following selected data pertain to Flagship Corporation: Cash operating expenses July 1-31 $180,000 Depreciation 60,000 Merchandise purchases in July 560,000 Estimated payments in July for June purchases 220,000 Estimated payments in July for purchases prior to June 50,000 Estimated payments in July for purchases in July 40% July's cash disbursements are expected to be: A. $404,000.B. $464,000.C. $674,000.D. $734,000.E. None of the answers is correct.

D. 3,2

The master budget contains the following components, among others: (1) direct-material budget, (2) budgeted balance sheet, (3) production budget, and (4) cash budget. Which of these components would be prepared first and which would be prepared last? First Last A. 1 4 B. 1 2 C. 3 4 D. 3 2 E. 4 1

D. add the desired ending raw-material inventory and subtract the beginning raw-material inventory.

To derive the raw material to purchase during an accounting period, an accountant would calculate the raw material required for production and then: A. add the beginning raw-material inventory and the desired ending raw-material inventory.B. subtract the beginning raw-material inventory and the desired ending raw-material inventory.C. add the beginning raw-material inventory and subtract the desired ending raw-material inventory.D. add the desired ending raw-material inventory and subtract the beginning raw-material inventory.E. add the desired ending raw-material inventory and subtract both the beginning raw-material inventory and the expected units to be sold.

c. 183,000

Virginia Enterprises makes all purchases on account, subject to the following payment pattern: Paid in the month of purchase: 30% Paid in the first month following purchase: 65% Paid in the second month following purchase: 5% If purchases for April, May, and June were $200,000, $160,000, and $250,000, respectively, what was the firm's budgeted payables balance on June 30? A. $175,000.B. $179,000.C. $183,000.D. $189,000.

D. 1,244,550

What is Overton's estimated sales revenue for next year if each pair sells for an average of $30? A. $1,149,000.B. $1,200,000.C. $1,220,550.D. $1,244,550.

B participating budgeting

When an organization involves its many employees in the budgeting process in a meaningful way, the organization is said to be using an approach most commonly known as: A. budgetary slack.B. participative budgeting.C. budget padding.D. imposed budgeting.E. employee-based budgeting.

D. Cash budget.

Which of the following budgets is based on many other master-budget components? A. Direct labor budget.B. Overhead budget.C. Sales budget.D. Cash budget.E. Selling and administrative expense budget.

C. Budgeted financial statements.

Which of the following budgets is prepared at the end of the budget-construction cycle? A. Sales budget.B. Production budget.C. Budgeted financial statements.D. Cash budget.E. Overhead budget.

B, yes,yes,yes

Which of the following choices correctly denotes managerial functions that are commonly associated with budgeting? Planning Performance Evaluation Coordination of Activities A. Yes Yes No B. Yes Yes Yes C. Yes No No D. Yes No Yes E. No Yes No

E. None of the above

Which of the following organizations is not likely to use budgets? A. Manufacturing firms.B. Merchandising firms.C. Firms in service industries.D. Nonprofit organizations.E. None of the answers is correct, because all are likely to use budgets.

E Budget preparation time can be somewhat lengthy and the problem of budget padding may arise.

Which of the following outcomes is (are) sometimes associated with participative budgeting? A. Employees make little effort to achieve budgetary goals.B. Budget preparation time can be somewhat lengthy.C. The problem of budget padding may arise.D. Financial modeling becomes much more difficult to undertake.E. Budget preparation time can be somewhat lengthy and the problem of budget padding may arise.

D. FPMs have become less popular in recent years because of computers and spreadsheets.

Which of the following statements about financial planning models (FPMs) is (are) false? A. FPMs express a company's financial and operating relationships in mathematical terms.B. FPMs allow a user to explore the impact of changes in variables.C. FPMs are commonly known as "what-if" models.D. FPMs have become less popular in recent years because of computers and spreadsheets.E. Both FPMs are commonly known as "what-if" models and FPMs have become less popular in recent years because of computers and spreadsheets.

E. The sales forecast is typically completed before the master budget and has significant impact on the master budget.

Which of the following statements best describes the relationship between the sales-forecasting process and the master-budgeting process? A. The sales forecast is typically completed after completion of the master budget.B. The sales forecast is typically completed approximately halfway through the master-budget process.C. The sales forecast is typically completed before the master budget and has no impact on the master budget.D. The sales forecast is typically completed before the master budget and has little impact on the master budget.E. The sales forecast is typically completed before the master budget and has significant impact on the master budget.

E. the budget director usually has the authority

Which of the following statements concerning the budget director is false? A. The budget director is often an organization's controller.B. The budget director has the responsibility of specifying the process by which budget data will be gathered.C. The budget director collects information and participates in preparing the master budget.D. The budget director communicates budget procedures and deadlines to employees throughout an organization.E. The budget director usually has the authority to give final approval to the master budget.

D. This budget uses a format that is prepared by companies for external reporting purposes.

Which of the following statements is false regarding the budgeted schedule of cost of goods manufactured and sold? A. This budget schedule first summarizes the various costs of production from other budget schedules to compute the period's total manufacturing costs. B. This budget adjusts for the beginning and ending cost of work-in-process inventory to compute the cost of goods manufactured. C. This budget computes cost of goods sold by adjusting cost of goods manufactured by the beginning and ending balances in finished goods inventory. D. This budget uses a format that is prepared by companies for external reporting purposes. E. This budget shows production costs that are expected to flow through the inventory accounts.

D. Yes Yes Yes

Which of the following would be considered when preparing a company's sales forecast? Anticipated Advertising Campaigns General Economic Trends Expected Competitive Actions A. Yes Yes No B. Yes No Yes C. Yes No No D. Yes Yes Yes E. No No Yes

D. 3-1-4-2.

Which of the following would depict the logical order for preparing (1) a production budget, (2) a cash budget, (3) a sales budget, and (4) a direct-labor budget? A. 1-3-4-2.B. 2-3-1-4.C. 2-1-3-4.D. 3-1-4-2.E. 3-1-2-4.

E. None of the answers is correct, since all of these items would have some influence.

Which of the following would have no effect, either direct or indirect, on an organization's cash budget? A. Sales revenues.B. Outlays for professional labor.C. Advertising expenditures.D. Raw material purchases.E. None of the answers is correct, since all of these items would have some influence.

A. Batch-level costs: Production setup.

Wu Production Company, which uses activity-based budgeting, is in the process of preparing a manufacturing overhead budget. Which of the following would likely appear on that budget? A. Batch-level costs: Production setup.B. Unit-level costs: Depreciation.C. Unit-level costs: Maintenance.D. Product-level costs: Insurance and property taxes.E. Facility and general operations-level costs: Indirect material.