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A master budget _______. Question content area bottom Part 1 A. should not be altered after it has been agreed upon B. includes only financial

A master budget _______.

Question content area bottom

Part 1

A.

should not be altered after it has been agreed upon

B.

includes only financial aspects of a plan and excludes nonfinancial aspects

C.

includes broad expectations and visionary results

D.

is based upon budget constraints outside of management control

E.

is an aid to coordinating what needs to be done to implement a plan

2.The operating budget process generally concludes with the preparation of the ________.

Question content area bottom

Part 1

A.

budgeted income statement

B.

balance sheet

C.

cash flow statement

D.

production budget

3.The direct materials usage budget is based on _______.

Question content area bottom

Part 1

A.

the units to be produced during a period

B.

the amount of labour hours worked

C.

the predetermined factory overhead rate

D.

budgeted sales dollars

E.

direct materials purchases

4.In going from the sales budget to the production budget, adjustments need to be made for _______.

Question content area bottom

Part 1

A.

finished goods inventories

B.

direct materials inventories

C.

overhead charges

D.

sales returns and allowances

E.

changing from revenue to cost

5.The reason for tracing a cost in responsibility accounting is to determine which of the following?

Question content area bottom

Part 1

A.

either who has the best knowledge about why the costs arose or, what activity caused the costs to be incurred

B.

whether it is production or administration

C.

whether it is fixed or variable

D.

who has the best knowledge about why the costs arose

E.

what activity caused the costs to be incurred

6.Which of the following anticipated future costs always differ among alternative courses of actions?

Question content area bottom

Part 1

A.

indirect costs

B.

relevant costs

C.

historical costs

D.

direct labour costs

E.

direct materials costs

7.Peter owns a small body shop. His major costs include labour, parts, and rent. In the decision making process, these costs are always considered to be ________.

Question content area bottom

Part 1

A.

quantitative factors

B.

fixed

C.

relevant costs

D.

variable

E.

qualitative factors

8.Good Sign Company manufactures signs from direct materials to the finished product. This is an example of which of the following?

Question content area bottom

Part 1

A.

utilization of idle facilities

B.

outsourcing

C.

product needs analysis

D.

product specialization

E.

insourcing

9.If Henry Inc. doesn't use one of its limited resources in the best possible way, the lost contribution to income could be called ________.

Question content area bottom

Part 1

A.

a total alternative cost

B.

an opportunity cost

C.

an alternative cost

D.

a constraining factor

E.

a resource cost

10.Top management faces a persistent challenge to make sure that the performance evaluation model of lower level managers is _______.

Question content area bottom

Part 1

A.

based only on future costs

B.

based solely on quantitative factors

C.

not consistent with the decision model

D.

focused on

short-term

performance

E.

consistent with the decision model

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