Management Accounting quiz 4 (Chapter 9)
A formal written statement of management's plans for a specified future time period expressed in financial term is a(n) a)accounting plan b)budget c)research analysis d) sales budget
b
All of the following are financial budgets except the a) budgeted balance sheet b) budgeted income statement c) capital expenditure budget d) cash budget
b
If required production units are 75'000, budgetd sales units are 65'000, required direct materials purchase units are 3'000 and beginning finished goods units are 5'000 then desired ending finished goods units would be a) 2'000 b) 5'000 c) 12'000 d) 15'000
d
The master budget includes all of the following except a)Budgeted Income Statement b)Capital Expenditure Budget c)Cash Budget d)Indirect Labor Budget
d
Budgeting is not used in not-for-profit organizations because it is not necessary for these organizations to engage in profit planning. True/False
False
Budgeting is the process of establishing company-wide objectives that serve as a deterrent to waste and inefficiency. True/False
False
One disadvantage of budgeting is that it does not faciliate the coordination of activities with a business. True/False
False
The manufacturing overhead budgetshows only the expected labor costs for the year. True/False
False
Budgeting always has the effect on human behavior of inspiring managers to higher levels of performance. True/False
False
Long-range planning differs from budgeting in the time period involved, emphasis, and the amount of detail presented. True/False
True
The budgeted income statement indicates the expected profitability of operations for the next year and provides the basis for evaluating company performance. True/False
True
The effectiveness of the budget program is directly related to its acceptance by all levels of management. True/False
True
The quantities of direct materials in the direct materials budget are derived from the formula: Desired Ending Direct Materials Units + Direct Materials Units Required for Production - Beginning Direct Materials Units = Required Direct Materials Units to be Purchased. True/False
True
The sales budget is the first budget prepared and each of the other budgets depends on it. True/False
True
Which of the following is not a benefit of budgeting? a)It reveals the prevailing business conditions. b)It results in greater management awreness of the entity's overall operations. c)It creates an early warning system of potential problems. d)It provides definite objectives for evaluating performance at each level of responsibility
a
