1.Danbro Distributors is considering whether to open a new wholesale center. The planning committee prepares a master budget for the first quarter of its intended operation (January through March). Monthly sales are expected to be $500,000, half in cash and half on account. All sales on account are collected by the end of the following month.

On the Danbro forecasted income statement on March 31, what will be the total budgeted quarterly Sales Revenue?

		500,000
		1,000,000
		1,500,000
		250,000

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2.Danbro Distributors is considering whether to open a new wholesale center. The planning committee prepares a master budget for the first quarter of its intended operation (January through March). Monthly sales are expected to be $500,000, half in cash and half on account. All sales on account are collected by the end of the following month.

Danbro's cash collections for each month would be

500,000 per month

250,000 in Jan, and 500,000 in Feb and Mar

250,000 per month

250,000 in Jan, 500,000 in Feb and 250,000 in Mar

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3.Danbro Distributors is considering whether to open a new wholesale center. The planning committee prepares a master budget for the first quarter of its intended operation (January through March). Monthly sales are expected to be $500,000, half in cash and half on account. All sales on account are collected by the end of the following month.

The amount in Danbro's Accounts Receivable on March 31 would be

1,500,000

500,000

250,000

0

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4.A measure of the extent to which fixed costs are being used in an organization is known as

Breakeven

Managerial accounting

Discretionary income

Operating leverage

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5.Operating leverage would be lowest in companies that

		have equal amounts of fixed and variable costs
		have a high proportion of fixed costs in relation to variable costs
		have a low proportion of fixed costs in relation to variable costs
		have no variable costs