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Exam 21: Budgeting

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Question 81

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To meet projected annual sales, Bluegill Manufacturers, Inc. needs to produce 75,000 machines for the year. The estimated January 1 inventory is 7,000 units, and the desired December 31 inventory is 12,000 units. What are projected sales units for the year?

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Question 82

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The budget process involves doing all of the following except

A) establishing specific goals
B) executing plans to achieve the goals
C) periodically comparing actual results with the goals
D) dismissing all managers who fail to achieve operational goals specified in the budget

E) A) and D)
F) C) and D)

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Question 83

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The first budget to be prepared is usually the sales budget.

Principal components of a master budget include

The production budgets are used to prepare which of the following budgets?

The dollar amount of Material C used in production during the year is

The number of pounds of Materials A and B required for August production is

Match the phrase that follows with the term a-e) it describes. -integrated set of operating and financing budgets for a period of time

A budget procedure that provides for the maintenance at all times of a twelve-month projection into the future is called master budgeting.

The budgeting process does not involve which of the following activities?

Detailed supplemental schedules based on department responsibility are often prepared for major items in the operating expenses budget.

For February, sales revenue is $700,000; sales commissions are 5% of sales; the sales manager's salary is $96,000; advertising expenses are $90,000; shipping expenses total 2% of sales; and miscellaneous selling expenses are $2,500 plus 1/2 of 1% of sales. Total selling expenses for the month of February are

Supervisor salaries, maintenance, and indirect factory wages would normally appear in the operating expenses budget.

A company's history indicates that 20% of its sales are for cash and the rest are on credit. Collections on credit sales are 20% in the month of the sale, 50% in the next month, 25% the following month, and 5% is uncollectible. Projected sales for December, January, and February are $60,000, $85,000, and $95,000, respectively. The February expected cash receipts from all current and prior credit sales is

Match each phrase that follows with the term a-e) it describes. -setting goals

Match the phrase that follows with the term a-e) it describes. -estimates the number of units to be manufactured to meet sales and inventory levels

Budget preparation is best determined in a top-down managerial approach.

An October sales forecast projects 7,000 units are going to be sold at a price of $11.50 per unit. The desired ending inventory in units is 15% higher than the beginning inventory of 1,000 units. Total October sales are anticipated to be

The budget that summarizes future plans for the acquisition of fixed assets is

-The number of pounds of materials A and B required for July production is