An overhead budget shows the expected cost of all production costs:

a.other than fixed overhead items.

b.other than direct materials and direct labor.

c.including selling and administrative expenses.

d.including direct materials and direct labor.

To create a meaningful performance report, _____.

a.actual costs and prior period costs must be compared at the same level of activity

b.actual costs and expected costs must be compared at two different levels of activity

c.actual costs and expected costs must be compared at the same level of activity

d.actual costs and prior period costs must be compared at two different levels of activity

Which of the following formulas is used to compute units to be produced while preparing a production budget?

a.Units to Be Produced = Expected Units Sales + Units in Desired Ending Inventory Units in Beginning Inventory

b.Units to Be Produced = Expected Production Units Ending Inventory Units + Beginning Inventory Units

c.Units to Be Produced = Expected Production Units + Ending Inventory Units Beginning Inventory Units

d.Units to Be Produced = Expected Units Sales + Units in Desired Ending Inventory + Units in Beginning Inventory

The actual and budgeted costs for Synergy Inc.'s actual level of activity are as follows:

		Actual Costs	Budgeted Costs
Units produced		1,500	1,500
Direct materials cost		$5,620	$5,000
Direct labor cost		1,760	1,480
VOH:
	Maintenance	725	635
	Power	250	160
FOH:
	Grounds keeping	1,400	1,240
	Depreciation	510	510

Calculate the flexible budget variance.

a.$160F

b.$1,240U

c.$1,080U

d.$90F

_____ is an example of a monetary incentive used to control a manager's tendency to shirk and waste resources.

a.Job enrichment

b.A recognition program

c.Increased responsibility

d.A promotion

Which of the following is true of an after-the-fact flexible budget?

a.It allows managers to develop financial results for a number of potential scenarios.

b.It is used to compute what the costs should be for the level of output that actually occurred.

c.It allows managers to see what costs will be for different levels of activity, thus helping in planning.

d.It is a budget created in advance that is based on a particular level of activity.

A(n) _____ is a financial budget.

a.production budget

b.budget for capital expenditures

c.overhead budget

d.budgeted income statement

Which of the following is a key feature of an ideal budget?

a.Participative budgeting

b.Single measure of performance

c.One time feedback on performance

d.Only monetary incentives

Excellent Corp. expects the following total sales for the coming year:

Quarter 1	$10,000
Quarter 2	$12,000
Quarter 3	$15,000
Quarter 4	$20,000

From past experience, Excellent Corp. expects that, on average, 20% of total sales are cash and 80% of total sales are on credit. Of the credit sales, Excellent Corp. expects that 80% will be paid in cash during the quarter of sale, and the remaining 20% will be paid in the following quarter. The balance in Accounts Receivable as of the last quarter of the prior year was $1,500. This will be collected in cash during the first quarter of the coming year. Calculate the total amount of cash receipts from sales expected in Quarter 1 of the coming year.

a.$8,400

b.$4,000

c.$9,900

d.$6,400

_____ budgets detail the inflows and outflows of cash.

a.Operating

b.Sales

c.Capital

d.Financial

_____ budgets describe the income-generating activities of a firm: sales, production, and finished goods inventories.

a.Financial

b.Operating

c.Cash

d.Capital

Assume that the salespeople of Excellent Corp. are paid 4% of sales as commission. The level of sales is $200,000 for this month, and the only fixed selling costs are $30,000. Excellent's budgeted selling costs for this month are:

a.$38,000.

b.$48,000.

c.$22,000.

d.$30,000.