49.
Preparation of a budgeted income statement does
not
require:
50.
Which element of a master budget would normally be prepared last?
51.
A cash budget is affected directly by each of the following
except
:
52.
In a cash budget, the budgeted level of cash receipts depends on all of the following
except
:
The following information is from the manufacturing budget and budgeted financial
statements of Altman Corp.:
53.
Refer to the information above. For the year, budgeted purchases of direct materials
amounted to:
54.
Refer to the information above. For the year, budgeted cash payments to suppliers
amounted to:
55.
Wateredge Corporation has budgeted a total of $361,800 in costs and expenses for the
upcoming quarter. Of this amount, $45,000 represents depreciation expense and $7,300
represents the expiration of prepayments. Wateredge’s current payables balance is
$265,000 at the beginning of the quarter. Budgeted payments on current payables for the
quarter amount to $370,000. The company’s estimated current payables balance at the end
of the quarter is:
23–25
56.
Sherman has budgeted sales for the upcoming quarter as follows:
The desired ending finished goods inventory for each month is one-half of next month’s
budgeted sales. Three pounds of direct material are required for each unit produced. If
direct material costs $5 per pound, and must be paid for in the month of purchase, the
budgeted direct materials purchases (in dollars) for April are:
On March 1, Hugh Corporation plans to borrow $550,000 from the Scotland State Bank by
signing a 12%, 15-year note payable. The note calls for 180 monthly payments of $6,000,
which includes both interest and principal components.
57.
Refer to the information above. Hugh’s budgeted interest expense for March is:
58.
Refer to the information above. Of Hugh’s budgeted debt service cost of $6,000 in March,
the amount applied to the principal of the note totals:
59.
Refer to the information above. What are Ross’s budgeted collections for July?
60.
Refer to the information above. What is the budgeted balance of Ross’s accounts
receivable as of July 31?
On October 1 of the current year, Molloy Corporation prepared a cash budget for October,
November, and December. All of Molloy’s sales are made on account. The following
information was used in preparing estimated cash collections:
Approximately 60% of all sales are collected in the month of the sale, 30% is collected in
the following month, and 10% is collected in the month thereafter.
61.
Refer to the information above. Budgeted collections from customers in October total:
62.
Refer to the information above. Budgeted collections from customers in November total:
63.
Refer to the information above. Budgeted collections from customers in December total:
64.
As the volume of output increases:
65.
As the volume of output decrease:
66.
Costs that rise and fall proportionately with the volume of output are often referred to as:
67.
A budget that can be easily adjusted to show budgeted revenues, costs, and cash flows at
different levels of activity is known as:
68.
If the volume of output of a factory for the month of June is 50,000 units, while the
budgeted output was 40,000 units:
69.
A flexible budget is one that:
70.
A flexible budget:
71.
Flexible budgeting may be viewed as combining the concepts of budgeting and:
72.
Flexible budgeting may be used for profit centers by applying cost-volume-profit
relationships to the actual level of:
73.
In a flexible budget for a profit center, which of the following items would
not
be expected
to vary with the level of activity?
23–35
74.
Armstrong, Inc. uses a flexible budget. Armstrong produced 16,000 units in May incurring
direct materials cost of $20,480. Its master budget for the year projected direct materials
cost of $362,500, at a production volume of 290,000 units. A flexible budget for May should
reflect direct materials cost of:
Skelton Corporation had planned to produce 50,000 units of product during the first quarter
of the current year. The company prepared the following budget on May 1:
During the first quarter, Skelton produced 60,000 units and incurred total manufacturing
costs of $184,000.
75.
Refer to the information above. Which of the following amounts should
not
be included in
Skelton’s flexible budget at a 60,000-unit level?
76.
Refer to the information above. A performance report for Skelton’s first quarter of
operations using a flexible budget approach would show:
23–37
77.
Refer to the information above. The cost-volume relationship used to prepare Skelton’s
flexible budget for various production levels includes:
Fixed cost of $1.17 per unit.
Manufacturing overhead costs of $1.43 per unit.
Variable costs of $2.07 per unit.
Total cost of $3.05 per unit.
Baskin Promotions, Inc. sells T-shirts decorated for a variety of concert performers. The
company has developed the following budget for the coming year based on a sales forecast
of 80,000 T-shirts:
Cost of goods sold and variable operating expenses vary directly with sales, and the income
tax rate is 30% at all levels of operating income.
If the concert season is slow due to poor weather, Baskin estimates that sales could fall to
as low as 60,000 T-shirts.
78.
Refer to the information above. In a flexible budget for sales of 60,000 T-shirts, how much
would Baskin budget for operating expenses?
79.
Refer to the information above. What unit cost did Baskin use in budgeting the cost of
goods sold for the year?