1. Triangle Corp. sells only one product. When the activity measure is the number of units sold, the revenue variance on its flexible budget performance report is favorable if: el a. b. the average actual selling price per unit is greater than expected the number of units sold is greater than expected Both a. and b. Either a. or b. c. d. 2. Katen Industries Inc. is working on its cash budget for March. The budgeted beginning cash balance is $56,000. Budgeted cash disbursements total $176,000 and budgeted cash receipts total $147,000. How much must Katen borrow if it has a policy requiring that the minimum ending cash balance each month is $40,000?- a. $13,000 b. $16,000 $27,000 d. $29,000+ c. e el 3. Which of the following may appear on a flexible budget performance report?- a. An unfavorable activity variance. b. A favorable revenue variance. c. An unfavorable spending variance. d. All of the above may appear on a flexible budget performance report.- 4. The usual starting point for a master budget is: a. b. c. d. the sales budget. the direct materials purchase budget. the budgeted income statement. the production budget. e 5. Budgeting which begins with the work of local area managers and includes the cooperation of managers at all levels in setting budget targets is called:- a. b. c. d. Standard budgeting. Mandated budgeting. Top-down budgeting. Bottom-up budgeting. 6. Cornelius Inc. is budgeting its balance sheet for 2020 and has budgeted net income for 2020 of $285,000. If Cornelius budgeted the 2020 beginning balance of retained earnings at $240,000 and plans to pay dividends of $180,000 during 2020, the budgeted balance in retained earnings for the end of the year should be: a. b. c. d. $225,000.- $525,000.- $345,000.- $420,000.- 7. Riley Sporting Goods has a number of store locations throughout the U.S. In income statements segmented by store, which of the following would be considered a common fixed cost with respect to the stores? the cost of Riley store manager salaries b. the cost of utilities at each Riley retail location. the cost of Riley's national branding campaign. d. the cost of goods sold at each Riley store. a. c. a. 8. If activity is higher than expected, total fixed costs in a flexible budget should be: higher than in the planning budget b. the same as the planning budget lower than in the planning budget d. the same as the actual results c. 9. Triangle Corp. produces and sells one product. In November it expects to sell 14,000 units of this product. The company's variable selling and administrative expense is $3.00 per unit sold and its fixed selling and administrative expense is $50,000 per month. The estimated selling and administrative expense for November is closest to: $92,000.- b. $64,000.- c. $50,000.- d. $42,000 a 10. Miller Corp. has just segmented last year's income statement into its ten product lines. Management is curious as to what effect dropping one of the product lines at the beginning of last year would have had on overall company profit. What is the best number for management to look at to determine the effect of this elimination on the net operating income of the company as a whole?" the product line's sales dollars. b. the product line's segment margin the product line's contribution margin. d. the product line's segment margin minus an allocated portion of common fixed expenses a. c. 11. Nantor Corporation has two divisions, Southern and Northern. The following information was taken from last year's income statement segmented by division: Sales Contribution margin Divisional segment margin Total Company Southern Northern $ 8,000,000 $5,000,000 +$ 3,000,000 $ 3,300,000 $2,100,000 $ 1,200,000 $ 2,000,000 $1,400,000 $ 600,000 Net operating income last year for Nantor Corporation was $800,000.- In last year's income statement segmented by division, what were Nanter's total traceable fixed expenses? a. $4,700,000 b. $1,300,000 $2,700,000 d. $1,200,000 - c. 12. A company's development of objectives and preparation of various budgets to achieve those objectives is known as: e a. b. control. financial reporting. planning. none of the above. C. d. 13. Which of the following statements is true? a. b. Employee motivation is generally higher when mandated budgeting is used. Budgets are generally more accurate when prepared from the top-down. Budgetary slack is generally a bigger risk when participative budgeting is used. None of the above. c. d 14. If Square Corp. allocates its common fixed expenses to its various segments, it: a. may cause managers to erroneously keep business segments that should be dropped. b. ensures that all costs are covered. helps managers make good decisions. d may cause managers to erroneously discontinue business segments. c. a. 15. If the contribution margin is not sufficient to cover fixed expenses: a net operating loss occurs. b. total profit equals total expenses. contribution margin is negative. d. variable expenses equal contribution margin. C 16. A budget that is based on the actual activity of a period is known as a: a. b. continuous budget. planning budget. flexible budget. master budget. c. d