FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 23: Incremental Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 81

Multiple Choice

Review LaterAdd Note

Review Later

The direct materials budget details 1) the quantity of direct materials to be purchased. 2) the cost of direct materials to be purchased.

A) 1
B) 2
C) both 1 and 2
D) neither 1 nor 2

E) None of the above
F) C) and D)

Correct Answer

verified

Show Answer

Question 82

Short Answer

Review LaterAdd Note

Review Later

A __________________ is responsible for coordinating the preparation of the budget in many companies.

Correct Answer

verified

budget com...

View Answer

Show Answer

Question 83

Multiple Choice

Review LaterAdd Note

The single most important output in preparing financial budgets is the

Fischer, Inc. provided the following information: $\bullet$ Fischer pays 40% of merchandise purchases in the month purchased and 60% in the following month. $\bullet$ General operating expenses are budgeted to be $20,000 per month of which depreciation is $2,000 of this amount. Fischer pays operating expenses in the month incurred. Instructions Calculate Fischer's budgeted cash disbursements for May.

Troyer Company reported the following information for 2010: $\bullet$ Operating expenses are: Salaries, $50,000; Depreciation, $20,000; Rent, $10,000; Utilities, $14,000 $\bullet$ Operating expenses are paid during the month incurred. $\bullet$ Accounts payable is used only for inventory acquisitions. How much is the budgeted amount of cash to be paid for operating expenses in November?

Coordinating the preparation of the budget is the responsibility of the

The master budget for a service enterprise

Budgeting in not-for-profit organizations

Why are budgets useful in the planning process?

Harwood Company budgeted the following information for 2010: $\bullet$ Cost of goods sold is 40% of sales. Accounts payable is used only for inventory acquisitions. $\bullet$ Harwood purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month. $\bullet$ Selling and administrative expenses are budgeted at $40,000 for May and are expected to increase 5% per month. They are paid during the month of acquisition. In addition, budgeted depreciation is $10,000 per month. $\bullet$ Income taxes are $38,400 for July and are paid in the month incurred. Instructions Compute the amount of budgeted cash disbursements for July.

Munson Company reported the following information for 2010: $\bullet$ All sales are on credit. $\bullet$ Customer amounts on account are collected 50% in the month of sale and 50% in the following month. How much cash will Munson receive in November?

Hale Co. manufactures beanies. The budgeted units to be produced and sold are below: It takes 24 yards of yarn to produce a beanie. The company's policy is to maintain yarn at the end of each month equal to 5% of next month's production needs and to maintain a finished goods inventory at the end of each month equal to 20% of next month's anticipated production needs. The cost of yarn is $0.20 a yard. At August 1, 3,720 yards of yarn were on hand. Instructions Compute the budgeted cost of purchases.

In May 2010, the budget committee of Carney Stores assembles the following data in preparation of budgeted merchandise purchases for the month of June. 1. Expected sales: June $750,000, July $900,000. 2. Cost of goods sold is expected to be 70% of sales. 3. Desired ending merchandise inventory is 40% of the following (next) month's cost of goods sold. 4. The beginning inventory at June 1 will be the desired amount. Instructions (a) Compute the budgeted merchandise purchases for June. (b) Prepare the budgeted income statement for June through gross profit.

A well-developed budget can operate and enforce itself.

On January 1, Matzke Company has a beginning cash balance of $63,000. During the year, the company expects cash disbursements of $510,000 and cash receipts of $435,000. If Matzke requires an ending cash balance of $60,000, Matzke Company must borrow

Sandler Company has 6,000 units in beginning finished goods. The sales budget shows expected sales to be 24,000 units. If the production budget shows that 28,000 units are required for production, what was the desired ending finished goods?

The beginning cash balance is $15,000. Sales are forecasted at $600,000 of which 80% will be on credit. 70% of credit sales are expected to be collected in the year of sale. Cash expenditures for the year are forecasted at $375,000. Accounts Receivable from previous accounting periods totaling $9,000 will be collected in the current year. The company is required to make a $15,000 loan payment and an annual interest payment on the last day of every year. The loan balance as of the beginning of the year is $90,000, and the annual interest rate is 10%. Instructions Compute the excess of cash receipts over cash disbursements.

Many companies use ____________________________ budgets by dropping the month just ending and adding a future month.

Beginning cash balance plus total receipts

The flow of input data for budgeting should be from the highest levels of responsibility to the lowest.