Question
True or False 1. Ideal standards are effective in motivating employees to higher productivity. 2. One advantage of budgeting is that it allows subunit managers
True or False 1. Ideal standards are effective in motivating employees to higher productivity. 2. One advantage of budgeting is that it allows subunit managers independence from strategic planning. 3. The manager held accountable for unfavorable material price variances would be the raw materials purchasing manager. 4. The total Variable Cost and Fixed Cost variances should be determined by using a comparison of actual costs to Flexible Budget amounts, but to determine the overall difference between actual costs and the Static Budget amounts, a manager would also have to consider extra or lost Contribution Margin from the difference in Static Budget sales volume and the Flexible Budget sales volume. 5. The production budget, like the sales budget, is expressed in units and dollars. 6. If a company reports monthly production budget columns for January, February, and March as well as a Total First Quarter column, all amounts in the Quarter column will be the total of amounts shown in the January, February, and March columns 7. A production manager usually is responsible for both the direct materials usage variance and the direct labor efficiency variance. 8. If W Company expected to sell 3,000 units of product at a price of $4 each, but actually sold 2,500 units at a price of $5 each, the selling price variance would be $500. 9. No matter how sophisticated the budgeting process is, success, in general, only results if middle and lower-level managers believe that top management is truly interested in the final outcome and is willing to reward people for attaining the budget goals. 10. On the cash budget, each periods ending cash balance becomes the beginning cash balance for the next period. 11. Performance evaluation for managers should be done using flexible budgets, not static budgets.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started