1.

The direct materials budget projects purchases of which inventory account?

Select one:

a. Raw Materials

b. Cost of Goods Sold

c. Finished Goods

d. Work in Process

2.

The selling and administrative budget are comprised of which type of costs?

Select one:

a. Period costs

b. Product costs

c. Sunk costs

d. Opportunity costs

3.

Which one of the following would be included in the direct labor budget?

Select one:

a. Assembly worker's wages

b. President's administrative assistant wages

c. CFO's salary and bonuses

d. Plant manager's salary

4.

Costs of having inventory on-hand, include all of the following except:

Select one:

a. Costs to move and maintain inventory in the warehouse

b. Costs to purchase and operate a warehouse

c. Costs to order, examine and transport additional inventory

d. Opportunity costs of cash tied up in existing inventory

5.

Minimizing the cost of having inventory on-hand must be balanced with:

Select one:

a. A minimization of the cost of capital

b. A minimization of fixed selling costs

c. A well-planned projection of demand

d. A minimization of ordering costs