1. The order to follow when preparing the operating budget is: a) revenues budget, manufacturing overhead costs budget, and production budget b) costs of goods sold budget, production budget, and cash budget c) cash expenditures budget, revenues budget, and production budget. d) revenues budget, production budget, and direct manufacturing labor costs budget

2. Responsibility centers include all of the following EXCEPT: a) cost b) investment c) customers d) revenue

3. Participation of line managers in the budgeting process helps to create: a) greater commitment b) better past performance c) more fraud d) greater anxiety

4. Direct material purchases equal: a) production needs plus beginning inventories b) production needs plus target ending inventories c) production needs d) production needs plus target ending inventories less beginning inventories