Question 1

A production budget is to a manufacturing firm as a merchandise purchases budget is to a merchandising firm.

Accepted Answer

A) True 
 B)False

Question 2

Determine what the cash collection for October will be.

Accepted Answer

The answer of Determine what the cash collection for October...

Question 3

If Pardise Company plans to sell 480,000 units during July,the number of units it would have to manufacture during July would be:

Accepted Answer

A)   440,000.
B)   450,000.
C)   480,000.
D)   510,000.E) All of the above
F) None of the above

Question 4

In a budget of cash receipts for March,the total cash receipts would be:

Accepted Answer

A)   $8,200.
B)   $16,000.
C)   $17,800.
D)   $20,200.E) B) and C)
F) A) and D) C

Question 5

There are various budgets within the master budget.One of these budgets is the production budget.Which of the following BEST describes the production budget?

Accepted Answer

A)   It details the required direct labour hours.
B)   It details the required raw materials purchases.
C)   It is calculated based on the sales budget,the desired beginning inventory and the desired ending inventory.
D)   It summarizes the costs of producing required units for the budget period.E) None of the above
F) B) and C)

Question 6

A sales budget is given below for one of the products manufactured by the Key Co.:

Accepted Answer

The inventory of finished goods at the...

Question 7

Which of the following statements is true about zero-based budgeting?

Accepted Answer

A)   The process starts with last year's budget and changes anticipated are added or subtracted to get the current budget.
B)   Managers are required to justify all budgeted expenditures.
C)   Budgets have no financial components - are specified in product units only.
D)   Managers are required to use the prior year's budget without changes for the current year.E) All of the above
F) A) and B)

Question 8

The collections from customers during the first quarter (item a in thousands) are:

Accepted Answer

A)   $50.
B)   $57.
C)   $60.
D)   $73.E) A) and D)
F) A) and C)

Question 9

In a traditional incremental approach to budgeting,there is usually the assumption that the previous year's budget is used as a starting point.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is not a benefit of budgeting?

Accepted Answer

A)   It uncovers potential bottlenecks before they occur.
B)   It coordinates the activities of the entire organization by integrating the plans and objectives of the various parts.
C)   It ensures that accounting records comply with generally accepted accounting principles.
D)   It provides benchmarks for evaluating subsequent performance.E) A) and B)
F) C) and D) C

Question 11

The budgeted net income for December is:

Accepted Answer

A)   $42,500.
B)   $77,500.
C)   $107,500.
D)   $137,500.E) B) and D)
F) A) and D)

Question 12

Pardee Company plans to sell 12,000 units during the month of August.If the company has 2,500 units on hand at the start of the month,and plans to have 2,000 units on hand at the end of the month,how many units must be produced during the month?

Accepted Answer

A)   11,500 units.
B)   12,000 units.
C)   12,500 units.
D)   14,000 units.E) All of the above
F) B) and C)

Question 13

The beginning cash balance is not included on the cash budget since the cash budget deals exclusively with cash flows rather than with balance sheet amounts.

Accepted Answer

A) True 
 B)False

Question 14

Orion Corporation is preparing a cash budget for the six months beginning January 1.Shown below are the company's expected collection pattern and the budgeted sales for the period. Expected collection pattern:
65% collected in the month of sale
20% collected in the month after sale
10% collected in the second month after sale
4% collected in the third month after sale
1% uncollectible  The estimated total cash collections during April from sales and accounts receivables will be:

Accepted Answer

A)   $155,900.
B)   $167,000.
C)   $171,666.
D)   $173,400.E) A) and D)
F) A) and C) D

Question 15

If 500,000 finished units were to be manufactured during July,the units of raw material needed to be purchased would be:

Accepted Answer

A)   990,000.
B)   1,000,000.
C)   1,010,000.
D)   1,020,000.E) All of the above
F) A) and B)

Question 16

Budgets describe in financial terms the plans to achieve an entity's strategic objectives.

Accepted Answer

A) True 
 B)False

Question 17

A sales budget is given below for one of the products manufactured by the OMI Co.:

Accepted Answer

The inventory of finished goods at the...

Question 18

The repayment (including interest) of financing during the second quarter (item d in thousands) is:

Accepted Answer

A)   $0.
B)   $4.
C)   $7.
D)   $17.E) A) and B)
F) All of the above

Question 19

On a budgeted balance sheet,the retained earnings number is the net income number as projected by the budgeted income statement.

Accepted Answer

A) True 
 B)False

Question 20

Superior Industries' sales budget shows quarterly sales for the next year as follows:  Company policy is to have a finished goods inventory at the end of each quarter equal to 20% of the next quarter's sales.Budgeted production in units for the second quarter should be:

Accepted Answer

A)   7,200.
B)   8,000.
C)   8,400.
D)   8,800.E) B) and C)
F) A) and B)

Exam 7: Profit Planning

A production budget is to a manufacturing firm as a merchandise purchases budget is to a merchandising firm.

Correct Answer
verified

Determine what the cash collection for October will be.

Correct Answer
verified

If Pardise Company plans to sell 480,000 units during July,the number of units it would have to manufacture during July would be:

Correct Answer
verified

In a budget of cash receipts for March,the total cash receipts would be:

Correct Answer
verified
C

There are various budgets within the master budget.One of these budgets is the production budget.Which of the following BEST describes the production budget?

Correct Answer
verified

A sales budget is given below for one of the products manufactured by the Key Co.:

Correct Answer
verified

The inventory of finished goods at the...
View Answer

Which of the following statements is true about zero-based budgeting?

Correct Answer
verified

The collections from customers during the first quarter (item a in thousands) are:

Correct Answer
verified

In a traditional incremental approach to budgeting,there is usually the assumption that the previous year's budget is used as a starting point.

Correct Answer
verified

Which of the following is not a benefit of budgeting?

Correct Answer
verified
C

The budgeted net income for December is:

Correct Answer
verified

Pardee Company plans to sell 12,000 units during the month of August.If the company has 2,500 units on hand at the start of the month,and plans to have 2,000 units on hand at the end of the month,how many units must be produced during the month?

Correct Answer
verified

The beginning cash balance is not included on the cash budget since the cash budget deals exclusively with cash flows rather than with balance sheet amounts.

Correct Answer
verified

Correct Answer
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D

If 500,000 finished units were to be manufactured during July,the units of raw material needed to be purchased would be:

Correct Answer
verified

Budgets describe in financial terms the plans to achieve an entity's strategic objectives.

Correct Answer
verified

A sales budget is given below for one of the products manufactured by the OMI Co.:

Correct Answer
verified

The inventory of finished goods at the...
View Answer

The repayment (including interest) of financing during the second quarter (item d in thousands) is:

Correct Answer
verified

On a budgeted balance sheet,the retained earnings number is the net income number as projected by the budgeted income statement.

Correct Answer
verified

Superior Industries' sales budget shows quarterly sales for the next year as follows: Company policy is to have a finished goods inventory at the end of each quarter equal to 20% of the next quarter's sales.Budgeted production in units for the second quarter should be:

Correct Answer
verified

Exam 7: Profit Planning

A production budget is to a manufacturing firm as a merchandise purchases budget is to a merchandising firm.

Correct AnswerverifiedShow Answer

Determine what the cash collection for October will be.

Correct AnswerverifiedShow Answer

If Pardise Company plans to sell 480,000 units during July,the number of units it would have to manufacture during July would be:

Correct AnswerverifiedShow Answer

In a budget of cash receipts for March,the total cash receipts would be:

Correct AnswerverifiedC

There are various budgets within the master budget.One of these budgets is the production budget.Which of the following BEST describes the production budget?

Correct AnswerverifiedShow Answer

A sales budget is given below for one of the products manufactured by the Key Co.:

Correct Answerverified The inventory of finished goods at the...View AnswerShow Answer

Which of the following statements is true about zero-based budgeting?

Correct AnswerverifiedShow Answer

The collections from customers during the first quarter (item a in thousands) are:

Correct AnswerverifiedShow Answer

In a traditional incremental approach to budgeting,there is usually the assumption that the previous year's budget is used as a starting point.

Correct AnswerverifiedShow Answer

Which of the following is not a benefit of budgeting?

Correct AnswerverifiedC

The budgeted net income for December is:

Correct AnswerverifiedShow Answer

Pardee Company plans to sell 12,000 units during the month of August.If the company has 2,500 units on hand at the start of the month,and plans to have 2,000 units on hand at the end of the month,how many units must be produced during the month?

Correct AnswerverifiedShow Answer

The beginning cash balance is not included on the cash budget since the cash budget deals exclusively with cash flows rather than with balance sheet amounts.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedD

If 500,000 finished units were to be manufactured during July,the units of raw material needed to be purchased would be:

Correct AnswerverifiedShow Answer

Budgets describe in financial terms the plans to achieve an entity's strategic objectives.

Correct AnswerverifiedShow Answer

A sales budget is given below for one of the products manufactured by the OMI Co.:

Correct Answerverified The inventory of finished goods at the...View AnswerShow Answer

The repayment (including interest) of financing during the second quarter (item d in thousands) is:

Correct AnswerverifiedShow Answer

On a budgeted balance sheet,the retained earnings number is the net income number as projected by the budgeted income statement.

Correct AnswerverifiedShow Answer

Superior Industries' sales budget shows quarterly sales for the next year as follows: Company policy is to have a finished goods inventory at the end of each quarter equal to 20% of the next quarter's sales.Budgeted production in units for the second quarter should be:

Correct AnswerverifiedShow Answer

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C

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The inventory of finished goods at the...
View Answer

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C

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D

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The inventory of finished goods at the...
View Answer

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