As compared to "Participative Budgets" , "Imposed Budgets" tend to foster a higher degree of "buy-in/commitment" amongst the managers who must implement the budget. True False Question 4 ( 1 point) Saved "Liquidity Management" (in the Cash Budgeting process) involves addressing both cash shortfalls and surpluses in a timely manner True False Many of the topics covered in this course can be applied to your personal financial planning situation True False Question 10 (1 point) Saved "The company accountant provides you with the historical maintenance costs of a piece of machinery. so you can decide whether to replace it with a new unit. "This is an example of the following "function" of accounting. scorekeeping attention directing none of the listed answers are correct decision making Front line department managers do not participate in the formulation of the 4 Financial Statements, although they may be called upon for specific information inputs (example: inventory levels) True False Question 17 (1 point) saved In preparing the 4 Financial Statements, accountants utilize GAAP principles to help ensure comparability between years budget control all of the listed answers are correct The following types of organizations need to perform a Cash Budget for-profit organizations private sector companies not-for-profit organizations all of the listed answers are correct Question 6(1 point) Saved The following Financial Statements are typically prepared covering a period of time all of the listed answers are correct cash flow statement, balance sheet income statement, balance sheet cash flow statement, income statement A company buys $50,000 of new equipment on credit. As per the "Accounting Equation" the effect on Owner's Equity of this transaction is none of the listed answers are correct a decrease of $50,000 $0 an increase of $50,000 Question 2 (1 point) Saved Which organization would most likely be managed/controlled as a "cost" center. human resource department university Which of the following would lead to an "unfavourable" variance actual unit material costs below budget actual unit sales levels below budget actual unit production numbers on budget actual revenue per unit higher than budgeted Question 22 (1 point) Saved "Zero-Based" budgeting's main goal is to get Department managers to completely "rethink" their operations from the "ground up/starting point of zero" in order to reduce wasted resources to save time in the budgeting process Individual department managers have full control over all aspects of their budget are responsible for understanding all items in their budget are fully responsible and have full control over all aspects of their budget Question 14 (1 point) Saved "The company accountant separates the monthly invoices for materials into the various product lines your company manufactures, so they can be tracked separately. " This is an example of the following "function" of accounting. none of the listed answers are correct scorekeeping decision making attention directing In setting the sales department's budget, the following managers need to work closely together to co-ordinate their activities "production and maintenance" to ensure the production department won't be shut down for significant lengths of time and thus unable to make product "production and sales" to ensure the production department has the capacity to meet the sales department's requests "senior management and sales" to ensure the sales department plans to sell enough product to ensure the financial success of the organization all of the listed answers are correct "A new manager wants to familiarize themselves with the basic functions of their new company - to accomplish this task they look at the company's budget" In this example, the budget is performing the following function/purpose motivation communication planning control Question 20(1 point) Saved The "accrual' method in accounting implies although sales may be legally recognized in a time period, the exchange of cash related to that sale may not occur in that same time period both detailed answers are correct although expenses may be legally recognized/incurred in a time period, the Every month the company accountant prepares a report indicating what budget line items were not met, and by how much." This is an example of the following "function" of accounting. scorekeeping attention directing decision making none of the listed answers are correct uestion 24 (1 point) Saved An example of "padding the budget" would be the Production Manager knowingly underestimating labour costs at budgeting time. True False On the first day of his new business Joel invests $15,500 of his own money into the business; takes out a bank loan for another $5,000; and buys a $20,000 used car with the funds. According to the "Accounting Equation", assets for this new business at the end of the first day total $20,000 none of the listed answers are correct $30,000 $15,000 2uestion 27 (1 point) > Saved Of the 4 financial statements, only the Balance Sheet \& Cash Flow Statement are formulated "at a point in time" True As discussed in class, the final step in the Budgeting process is implementing "Benchmarking" practices finetuning the "Master Budget" after it has been reviewed by senior management for changes/improvements combining the Sales, Production and Service Departments' budget into one document known as the "Master Budget" reviewing the previous year's budget Question 29 (1 point) Saved The 4 Financial Statements (as covered in Chapter \#2) are not required to be produced by the "not-for-profit" sector. due to their absence of a "profit" motive True False Sales are forecasted as follows: May $100; June $500; July $300 \& August $925. Sales are forecast at 80% in cash, with the remainder received 1 month later. As a result of the above, Cash Receipts for August are forecast at Question 36 (1 point) Saved To help ensure comparability/standardization, accountants perform their functions according to a "set of rules" commonly referred to as financial analysis GAP n setting the sales department's budget, the following managers need to work losely together to co-ordinate their activities "production and maintenance" to ensure the production department won't be shut down for significant lengths of time and thus unable to make product "production and sales" to ensure the production department has the capacity to meet the sales department's requests "senior management and sales" to ensure the sales department plans to sell enough product to ensure the financial success of the organization all of the listed answers are correct Service Departments' budgets are usually completed after the Production Department completes their budget because this practice follows the process known as Kaizen Budgeting The level of support/activity required from the Service Departments is only fully known after the Production forecast is complete Service Department costs are usually insignificant relative to the overall cost of running the organization this practice will help minimize the problems associated with "padding the budget" If actual sales revenues are below budget, it is safe to assume this is due to a lower number of units sold versus budget. True False Question 32(1 point) Saved Following the "Balanced Scorecard" approach to organization management, "safety records, quality control reports \& minimizing production times", would fall under which category internal business perspective customer perspective learning and growth perspective financial perspective The "Balanced Scorecard" approach to organization management strictly concentrates on historical data True False Question 8 (1 point) Saved The concept of "benchmarking" refers to the fact other managers in other companies may be willing to share information provided you as a manager are willing to do the same thing with them most of the time, a problem you as a manager are grappling with, has been handled by someone else all of the listed answers are correct managers often face problems they don't always have answers for Which of the following is the 1 st step in the budgeting process setting the production department's budget accessing the maintenance department's goals setting the sales department's targets finishing the service departments' budgets Question 34 (1 point) Saved A budget is best described as a summary of historical activities a summary of the sales manager's future objectives a summary of the production manager's future objectives plan for the future To help ensure comparability/standardization, accountants perform their functions according to a "set of rules" commonly referred to as financial analysis GAP GAAP scorekeeping