Chapter 9
The Use of Budgets in Planning and Decision Making
Multiple Choice
1. (LO 1—Budgets)
2. (LO 1—Advantages of budgeting)
3. (LO 2—Sales budget)
4. (LO 3—Production budget)
5. (LO 3—Formula for the production budget)
6. (LO 4—Materials purchases budget)
7. (LO 4—Materials purchases budget)
Answer: B
8. 127,000 boxes × $0.27/box = $34,290
(LO 4—Direct labor budget)
Answer: C
Solutions to Multiple Choice
MC9–2
9. (LO 5—Cash disbursements budget)
10. (LO 5—Cash receipts budget)
Answer: B
11. (LO 5—Summary cash budget)
12. (LO 6—Budgeted financial statements)
Answer: C
13. (LO 7—Budgets: merchandisers versus manufacturers)
14. (LO 8—Flexible budget)