Please provide answers with clear explanations/calculations.

Q1

An authoritative budget is most likely established by what party (or parties)?

A. The CEO

B. Department managers

C. The production line workers

D. It is established using input from each of these parties

Q2

In the budget process, the first item prepared is the:

A. cash budget.

B. production budget.

C. direct materials budget.

D. sales budget.

E. budgeted income statement.

Q3

If management wants finished goods inventory to increase over an accounting period, which of the following best describes the relationship between units sold and units produced?

A. The are equal.

B. Units sold are greater than units produced.

C. Units sold are less than units produced.

D. It cannot be determined without further information.

Q4

Which of the following pieces of information is NOT required for the direct labor budget?

A. The number of units to be produced.

B. The number of units of expected sales

C. Direct labor time required per unit

D. Direct labor cost per hour

Q5

Use the following budget data for Questions #5 and #6 for Key Corp., a maker of luxury couches.

2019 sales - 40,000 units

1/1/2019 finished goods inventory - 6,000 units

1/1/2019 raw materials inventory - 1,500 yards of cloth

Raw material required per couch - 2 yard of cloth

Raw material cost per yard - $40

Desired 12/31/2019 finished goods inventory - 9,000 units

Desired 12/31/2019 raw materials inventory - 1,200 yards of cloth

How many units would the production budget expect to be produced during 2019?

Q6

Use the following budget data for Questions #5 and #6 for Key Corp., a maker of luxury couches.

2019 sales - 40,000 units

1/1/2019 finished goods inventory - 6,000 units

1/1/2019 raw materials inventory - 1,500 yards of cloth

Raw material required per couch - 2 yard of cloth

Raw material cost per yard - $40

Desired 12/31/2019 finished goods inventory - 9,000 units

Desired 12/31/2019 raw materials inventory - 1,200 yards of cloth

How much cash would the direct materials budget show for cash paid for raw materials in 2019?

Q7

Use the following budget data for Questions #7 and #8 for Conan Corp., a maker of high-end computers.

Conan Corp. uses flexible budgets.

At a normal capacity of 10,000 units, the budgeted manufacturing overhead totals $210,000 ($70,000 variable, $140,000 fixed).

For the month of December, 12,000 units were produced at a total manufacturing overhead cost of $300,000.

How much would December's flexible budget estimate fortotal manufacturing overhead?

Q8

Use the following budget data for Questions #7 and #8 for Conan Corp., a maker of high-end computers.

Conan Corp. uses flexible budgets.

At a normal capacity of 10,000 units, the budgeted manufacturing overhead totals $210,000 ($70,000 variable, $140,000 fixed).

For the month of December, 12,000 units were produced at a total manufacturing overhead cost of $300,000.

What is the manufacturing overhead spending variance that would be shown on December's flexible budget?

a positive number if favorable; a negative number if unfavorable.

Q9

You budget your monthly groceries based on a projected number of meals cooked.When preparing your flexible budget, which of the following reasons would potentially explain an unfavorable spending variance regarding groceries?

A. You bought more groceries to make a greater number of meals for some out of town guests.

B. This month you shopped at the more expensive Whole Foods market rather than buying from your normal discount grocer.

C. Sad from sheltering in place, you ate five meals a day instead of three...plus some snacks.

Q10

Banshee Enterprises compares annual operating results to a static budget prepared at the beginning of the year. When the actual level of activity is greater than budgeted, which of the following would typically be true?

A. Fixed costs would show unfavorable variances.

B. Fixed costs would show favorable variances.

C. Variable costs would show unfavorable variances.

D. Varible costs would show favorable variances.

E. None of the above.