1. Master Budget

Select one:

a. As master budget, it oversees all subsidiary budgets and provides guidance and advice to the subsidiary manager.

b. None of these

c. The main benefit is that the master budget is developed only when actual results are known - so it is more accurate and timely than a dynamic budget.

d. A master budget is really just a name for a static budget - and both are of very little value in dynamic companies.

2. Which of the following is an example of a period cost and not a product cost?

Select one:

a. Salary of the Supervisor in the Finished Goods Warehouse

b. Factory Utilities

c. Factory Worker Wages and Benefits

d. Factory Equipment Amortization

3.Which of the following companies is the best candidate for using a job order costing system?

Select one:

a. An automotive retailing business

b. Saputo - a large dairy.

c. Petro Canada, An oil company

d. Bombardier - which manufacturers snow machines, trains and jets.

4. Absorption Costing

Select one:

a. Required for external financial reporting.

b. Must not be used for external financial reporting.

c. May be used in external financial reporting, but only if there is a clear reconciliation to variable costing procedures which are normally required to comply with Canadian Reporting and Analysis Policies (C.R.A.P.)

d. We measure the extent to which production costs are absorbed into product costs compared to those which are reported as period costs.