Diaz Co$.$ budgeted sales of $$80,000$ for January and $$90,000$ for February. Seventy percent $(70\%)$ of sales are for cash and the remaining $30\%$ are credit sales. All credit sales are collected in the month after the sale. For the month of February, what are the expected cash receipts for the Diaz cash budget?

a$.$ $$90,000$

b$.$ $$87,000$

c$.$ $$63,000$

d$.$ $$27,000$

Master budgets may be prepared based on one predicted mount of sales $($fixed or static$)$ or based on more than one amount of sales $($flexible or variable$).$

a$.$ True

b$.$ False

During $2024,$ actual sales were higher than budget sales. Accordingly, the variable costs associated with the sales also increased. For $2024,$ was the variance of budgeted variable costs to actual variable costs favorable or unfavorable?

a$.$ Favorable

b$.$ Unfavorable

Assuming the same fact pattern as in #$15$ above regarding actual sales being higher than budgeted sales, what would be the expected impact on fixed costs during the same period?

a$.$ Favorable variance to budget

b$.$ Unfavorable variance to budget

c$.$ No impact of sales on fixed costs

d$.$ None of the above

If actual cost is greater than standard cost, the variance is favorable.

a$.$ True

b$.$ False

The standard cost is computed by multiplying the standard quantity by the standard price.

a$.$ True

b$.$ False

If actual sales are greater than budgeted sales, the variance is favorable.

a$.$ True

b$.$ False