1. An example of a mixed cost is a. utility costs. b. property taxes. c. direct materials. d. supervisory salaries. 2. Which of the following items does not follow from the adoption of a budget? a. Deterrent to waste b. Basis for performance evaluation c. Guarantee of accomplishing the profit objective d. Promote efficiency 3. A budget is most likely to be effective if a. employees and managers at the lower levels do not get involved in the budgeting process. b. it has top management support. c. it is used to assess blame when things do not occur according to plans. d. it is not used to evaluate a manager's performance. 4. In a production budget, total required units are the budgeted sales units plus a. desired ending finished goods units plus beginning finished goods units. b. desired ending finished goods units minus beginning finished goods units. c. beginning finished goods units. d. desired ending finished goods units. 5. Of the following items, which one is not obtained from an individual operating budget? a. Cost of goods sold b. Selling and administrative expenses c. Sales d. Accounts receivable 6. The formula for determining budgeted merchandise purchases is budgeted a. cost of goods sold + beginning inventory - desired ending inventory. b. sales + beginning inventory - desired ending inventory. c. cost of goods sold + desired ending inventory - beginning inventory. d. production + desired ending inventory - beginning inventory.