1

1. A primaryfinancial budgetthatisprepared in thebudgetingprocessis the
2. a.Production budget.
3. b.Selling and administrative budget.
4. c.Cash budget.
5. d.Inventory budget.

2 points

QUESTION 2

1. Which of the following is an indirect cost of manufacturing a table made of wood and glass, for a firm that manufactures furniture?
2. a.The cost of the glass in the table.
3. b.The cost of the wood in the table.
4. c.The cost of rent on the factory where the table is manufactured.
5. d.The cost of the labor used to assemble the table.

2 points

QUESTION 3

1. A master budget is an example of a
2. a.volume variance
3. b.pricevariance.
4. c.static budget.
5. d.flexible budget.

2 points

QUESTION 4

1. Lory's Fashions Inc.produces leather handbags.The production budget for the next four months is:July6,000units,August7,000,September8,000,October7,000.Each handbag requires0.5square meters of leather.Lory's Fashions,Inc.'s leather inventory policy is30%of next month's production needs.On July1leather inventory was expected to be1,000square meters.What will leather purchases be in July?(Roundyouranswer to thenearest wholeunit)
4. a.3,575 square meters
5. b.3,850 square meters
6. c.3,650 square meters
7. d.3,050 square meters

2 points

QUESTION 5

1. Variable costs are
2. a.costs that stay the same, in total, regardless of activity level.
3. b.costs that vary inversely, per unit, with the number of units produced.
4. c.costs that vary inversely, in total, with the number of units produced.
5. d.costs that change, in total, in direct proportion to changes in activity levels.

2 points

QUESTION 6

1. RedcoInchas a direct labor standard of 2 hours per unit of output. The averagestandardwage is rate of $22.50 per hour. During July,Redcopaid $94,750 to employees for 4,445 hours worked. 2,350 units were produced during July. What is the direct labor rate variance?(Round your answer to the nearest whole dollar)
2. a.$5,738FAVORABLE
3. b.$5263UNFAVORABLE
4. c.$5263FAVORABLE
5. d.$5,738UNFAVORABLE

2 points

QUESTION 7

1. Prime costs are the same as
2. a.Manufacturing costs minus manufacturing overhead.
3. b.Manufacturing costs minus fixed costs.
4. c.Manufacturing costs minus non-manufacturing costs.
5. d.Manufacturing costs minus direct materials.

2 points

QUESTION 8

1. After selling 4,300 units during the period, Dole Corp. prepared a flexible budget that included $22,962 for direct materials, $36,120 for direct labor, $19,350 for variable overhead, and $46,440 for fixed overhead. Dole originally planned its master budget based on sales of 4,000 units. What would total costs have been on the master budget?
3. a.116,160
4. b.119,400
5. c.111,070
6. d.124,872

2 points

QUESTION 9

1. Which of the following isnotincluded in the operating budget?
2. a.Budgeted balance sheet
3. b.Sales budget
4. c.Selling and administrative budget
5. d.Raw materials purchases budge

2 points

QUESTION 10

1. A company has a current ratio of2.01,total liabilities of$193,891,long-term payables of$96,791(the only long term liability on the books),and a quick ratio of.96.What are total current assets for the company?(Round your answer to the nearest whole dollar and do not use commas or dollar signsinyour answer)

2 points

QUESTION 11

1. Which of the following functions of management involves taking actions to implement the plan?
2. a.Organizing
3. b.Control
4. c.Planning
5. d.Directing/leading

2 points

QUESTION 12

1. Describe the purpose of horizontal financial statement analysis and how it is applied.Also in your description explain the two types of horizontal analyses and describe how they are different.
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6 points

QUESTION 13

1. Brown Beverage Company produces only12oz cans of a beverage. A sales budget for the next four months is as follows: March 11,000 units, April 15,000, May 23,000 and June 26,000 cases. Brown Beverage Company's ending finished goods inventory policy in cases is20% of the following month's sales.What is the budgeted ending finished goods inventory for April?(Round your answerto the nearest whole dollar)
3. a.1,500
4. b.4,000
5. c.2,300
6. d.4,600

2 points

QUESTION 14

1. Sam'sWarehouse Inc has forecast purchases on account to be $365,000 in January, 455,000 in February, $530,000 in March, and $635,000 in April. 70% of purchases are paid for in the month of purchase, the remaining amount is paid in the following month. What are budgeted cash payments for March?
4. a.371,000
5. b.136,500
6. c.507,500
7. d.338,000

2 points

QUESTION 15

1. Which of the following isnota source that can be used in preparing the sales budget?
2. a.Prior sales.
3. b.Industry trends.
4. c.Marketing activities
5. d.The production budget.

2 points

QUESTION 16

1. The starting point for preparing the master budget is the
2. a.production budget.
3. b.inventory policy.
4. c.sales budget.
5. d.budgeted balance sheet.

2 points

QUESTION 17

1. Three of the most common tools of financial analysis are (1) _________________________, (2) ___________________________ and (3)______________________________.

3 points

QUESTION 18

1. Bluebird Rubber, Inc. (BRI) is a manufacturer of tires for motorcycles. The company has a unique, patented process for producing tires that has helped the BRItogrow at a high rate since opening. While the owners of BRI have benefited from the companys sustained profitability, a recent offer to buy their company offered a significant financial gain to the company. The acquirer, MotoJoe, plans to use BRIs tire production solely for its motorcycles. MotoJoe management believes that this unique feature will help set MotoJoe motorcycles apart from competitors products. As MotoJoe works to integrate BRI into its organizational structure, what type of responsibility center would bemostappropriate for Bluebird Rubber as a subsidiary that will be solely focused on tire manufacturing?
4. a.Investment Center
5. b.ProfitCenter
6. c.CostCenter
7. d.RevenueCenter

2 points

QUESTION 19

1. Which of the following functions of management involves comparing actual results with budgeted results?
2. a.Control
3. b.Directing/Leadng
4. c.Organizing
5. d.Planning

2 points

QUESTION 20

1. ClevelandInc. has forecast sales to be $105,000 in February, $135,000 in March, $150,000 in April, and $175,000 in May. The average cost of goods sold is 50% of sales. All sales are made on credit and sales are collected 75% in the month of sale, and the remainingamount inthe month following. What are budgeted cash receipts in May?
4. a.163,130
5. b.131,250
6. c.173,080
7. d.168,750

2 points

QUESTION 21

1. A cost object is
2. a.an item to which it is not worth the effort of tracing costs.
3. b.an item for sale by a business.
4. c.an item to which managers must directly trace costs.
5. d.an item for which managers are trying to determine the cost.

2 points

QUESTION 22

1. The budgeted income statement is a combination of
2. a.The direct materials budget, the direct labor budget, and the manufacturing overhead budget.
3. b.The production budget, the cost of goods sold budget, and the selling and administrative expense budget.
4. c.All the operating budgets.
5. d.All the operating budgets plusthe budgeted balance sheet

2 points

QUESTION 23

1. A fixed cost
2. a.goes up in total when activity increases.
3. b.goes down in total when activity increases.
4. c.goes up in total when activity increases.
5. d.goes down per unit when activity increases.

2 points

QUESTION 24

1. Which of the following isnota characteristic of managerial accounting?
2. a.Information is subjective, relevant, future-oriented.
3. b.Reports are prepared according toGAAP.
4. c.Reports are prepared as needed.
5. d.Information is used by internal parties.

2 points

QUESTION 25

1. Which of the following isnota characteristic of financial accounting?
3. a.Information is used by external parties.
4. b.Information is subjective, relevant and future-oriented.
5. c.Reports are prepared periodically.
6. d.Financial reports are prepared according to GAAP

2 points

QUESTION 26

1. Budgeted cost of goods sold should include which of the following?
2. a.Raw materials, direct labor, manufacturing overhead, and selling expenses.
3. b.Raw materials, direct labor, manufacturing overhead, selling expenses, and administrative expenses
4. c.Raw materials and direct labor.
5. d.Raw materials, direct labor, and manufacturing overhead.

2 points

QUESTION 27

1. JonesCompanyhas budgeted fixed overhead of$135,000based on budgeted production of10,000units.During July,10,100units were produced and$134,000was spent on fixed overhead.What is the fixed overhead spending variance?
3. a.$1,000 favorable
4. b.$10,100 unfavorable
5. c.$10,100 favorable
6. d.$1,000 unfavorable

2 points

QUESTION 28

1. Chica's Fashions Outlet has forecast purchases to be $350,000 in January, $400,000 in February, $425,000 in March, and $600,000 in April. Purchases average 30% paid in cash, 70% are on credit. Credit purchases are paid 60% in the month of purchase, 30% during the month following, and 10% the second month following the purchase. Cash disbursements in April would be
3. a.180,000
4. b.369,250
5. c.549,250
6. d.600,000

2 points

QUESTION 29

1. Robin Company has the following balances for the current month:
3. Direct Materials Used24,000Direct Labor36,800Sales Salaries19,200Indirect Labor4,800Production Manager's Salary9,600Marketing Costs14,400Factory Lease6,400
4. What is Robin's total comversion cost?
6. a.60,600
7. b.84,600
8. c.23,800
9. d.33,600

2 points

QUESTION 30

1. A spending variance is made up of
2. a.volume variance and quantity variance.
3. b.price variance and volume variance
4. c.price variance and rate variance.
5. d.price variance and quantity variance.

2 points

QUESTION 31

1. A cost is $50,000 when 25,000 units are produced, and $50,000 when 50,000 units are produced. This is an example of a(n)
2. a.fixed cost.
3. b.direct cost.
4. c.variable cost.
5. d.indirect cost.

2 points

QUESTION 32

1. ____________________is a method of analysis used to evaluate individual financial statement items or groups of items in terms of a specific base amount withinthe same time period.

2 points

QUESTION 33

1. What is the primary goal of accounting?
3. a.To provide information for decision making.
4. b.To set long-term goals and objectives.
5. c.To motivate others to work towards a plan's success.
6. d.To arrange for the necessary resources to achieve a plan.

2 points

QUESTION 34

1. Contents Inc.has a material standard of 1 pound per unit of output. Each pound has a standard price of $26 per pound. During July, Contents Inc. paid $66,100 for 2,475 pounds, which they used to produce 2,350 units. What is the direct materials quantity variance?
3. a.$3,250 favorable
4. b.$1,750 unfavorable
5. c.$1,750 favorable
6. d.$3,250 unfavorable

2 points

QUESTION 35

1. When are period costs counted as inventory?
2. a.Never
3. b.After products are sold.
4. c.Before products are sold.
5. d.After products are completed, but before they are sold.

2 points

QUESTION 36

1. A company has a current ratio of2.10,total liabilities of$197,350,long-term notes payable(the only long-term liability)of$91,350,and a quick ratio of1.05.What are total quick assets for the company?(Round your answer to the nearest whole dollar and do not use commas or dollar signsinyour answer)

2 points

QUESTION 37

1. What is the main purpose of financial statementanalysis?
2. .Name at least 3 common analytical goals users of financial statements want to accomplish using financial statement analysis
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4 points

QUESTION 38

1. Robin Company has the following balances for the current month:
3. Direct Materials24,000Direct Labor36,800Sales Salaries19,200Indirect Labor4,800Production Manager Salary9,600Marketing Cost14,400Factory Lease6,400What is Robin's TotalManufacturing Cost
4. What are Robin's total manufacturing costs?
5. a.84,600
6. b.60,600
7. c.60,800
8. d.23,800

2 points

QUESTION 39

1. What determines the difference between a direct and an indirect cost?
2. a.Whether it can be traced to a specific cost object.
3. b.Whether it is related to manufacturing or nonmanufacturing activities.
4. c.Whether it is relevant to a particular decision.
5. d.Whether it changes when activity levels change.

2 points

QUESTION 40

1. A company has an inventory turnover ratio of4.20,merchandise inventory for2017of$87,065,and cost of goods sold of$315,000.What is the average inventory?(Round your answer to the nearest whole dollar anddo not use commas or dollar signs in your answer)

2 points

QUESTION 41

1. Contents,Inc.has a material standard of1.1pound per unit of output.Each pound has a standard price of$26.During September,Contents Inc paid$66,500for2,585pounds ofrawmaterial, to produce2,350units.What is the direct materials price variance?(Round your answer tothe nearest whole dollar)
2. a.$605 favorable
3. b.$710 favorable
4. c.$710 unfavorable
5. d.$605 unfavorable

2 points

QUESTION 42

1. BirchCabinets, Inc has forecast sales for the next three months as follows: January 4,000 units,February6,000 units, March 7,500 units. Birch's policy is to have an ending inventory of 40% of the next month's sales needs on hand. January 1 inventory is projected to be 1,500 units. Selling and administrative costs are budgeted to be $15,000 per month plus $5 per unit sold. What are budgeted selling and administrative expenses for February?
4. a.$45,000
5. b.$52,500
6. c.$30,000
7. d.$15,000

2 points

QUESTION 43

1. A cost is $50,000 when 25,000 units are produced, and $100,000 when 50,000 units are produced. This is an example of a(n)
2. a.direct cost.
3. b.fixed cost.
4. c.indirect cost
5. d.variable cost.

2 points

QUESTION 44

1. Which of the following statements about employee motivation is true?
2. a.Budgets are difficult to use for motivation.
3. b.A budget that is too easy to achieve is more likely to motivate than a budget that is too difficult or that is tight but attainable.
4. c.A budget that is tight but attainable is more likely to motivate than a budget that is too easy or too difficult to achieve.
5. d.A budget that is too difficult to achieve is more likely to motivate than a budget that is too easy or that is tight but attainable.

2 points

QUESTION 45

1. The comparison of a company's financial condition and performance across time is known as
2. a.ManagementbyObjectives
3. b.VerticalAnalysis
4. c.BalanceSheet
5. d.HorizontalAnalysis

2 points

QUESTION 46

1. Ajay Inc. produces metal axels. The sales budget for the next four months is: January 6,500 units, February 7,000, March 7,500, April 8,000. Ajay Inc.'s ending finished goods inventory policy is 25% of the following month's sales. Each axel requires 1.1 hours of unskilled labor (paid $9 per hour) and 1.5 hours of skilled labor (paid $16 per hour). What will be the standard total labor cost for the month of March?(Round your answer to the nearest whole dollar and do not use commas or dollar signs in your answer)
4. a.262,500
5. b.254,256
6. c.247,675
7. d.258,488

2 points

QUESTION 47

1. Conversion costs can be defined as
2. a.Manufacturing costs plus non-manufacturing costs.
3. b.Variable costs plus fixed costs.
4. c.Manufacturing costs minus direct materials.
5. d.Direct labor plus direct materials

2 points

QUESTION 48

1. Participative budgeting is an approach to budgeting that
3. a.discourages budget slack.
4. b.is more likely to motivate people to work towards the organization's goals than a top-down approach.
5. c.is top-down in nature.
6. d.allows top management to set the budget.