what are the answers

A budget where managers must justify all costs

based on need is a:

a.zero-base budget.

b. continuous budget.

c. incremental budget.

d. participatory budget.

Which of the following is NOT an operating budget?

Oa. Cost of sales budget

0 b. Cash budget

O c. Purchases budget

O d. Sales budget

A company sells product X for $80, with variable

cost per unit of $50. Total Fixed Cost is $900. What

is the break-even point in Sales ($)?

O a. $80

O b. $3,000

0 c. $30

O d. $2.400

Sales mix refers to:

O a. the mix of variable and fixed costs.

O b. the relative proportions of different

products that constitute total sales.

Oc.

the different volume of sales achieved

during the year.

O d. the contribution margins achieved on the

different products during the year.

At the beginning of the current month, Melrose had

$10,000 cash. Cash disbursements were $260,000

and cash collections were $235,000. If Melrose

wishes to start the next month with $15,000,

Melrose must borrow

O a. $15,000.

O b. $20,000.

O c. $45,000.

d. $30.000.

A master budget consists of:

O a.

a review of progress towards long-term

goals

O b. information that emphasizes cash

resources for capital planning

Oc.

interrelated budgets for an action plan for

a specific time period

O d. individual budgets made for short-term

goals

Sleepy Head Company produces and sells pillows. It

expects to sell 10,000 pillows in the year 2022 and

had 1,000 pillows in finished goods inventory at the

end of 2021. Sleepy Head would like to have ending

inventory for 2022 of at least 1,250 completed

pillows. The selling per unit is 5 each. Calculate total

sales for 2022.

O a. $56,250

0 b. $50,000

O c. $51,250

O d. $55,000

Which of the following statement is a characteristic

of break-even point?

0 a.

Total contribution is equal to total fixed

cost.

O b. Operating income is less than zero.

O c. Total cost is greater than total revenue.

O d.

Operating income is greater than zero.

In the production budget, the total units to be

produced is computed as:

O a. Units to be produced - Desired ending

inventory - Beginning inventory.

O b. Expected sales + Beginning inventory X

materials to be purchased.

O C.

Expected sales + Desired ending inventory

- Beginning inventory.

O d. Materials to be purchased - Desired ending

inventory + Units to be produced.

Janet sells a product for $6.25 per unit. The variable

cost per unit is $3.75. Janet's breakeven units are

35,000. What is the amount of fixed costs?

O a. $35,000

O b. $87,500

Oc.

$104.750

O d. $131.250

All the following are assumptions of CVP analysis

EXCEPT:

O a. it covers a single product or a constant

sales mix

O b. total fixed costs is known

O c. all units produced are sold

d. the time value of money is considered

Sojo's variable manufacturing overhead rate is $3

per labour hour. The budgeted labour hours for the

first quarter of the year are: January-225, February-

250 and March- 250. The company also have

monthly fixed manufacturing overhead of $2,050.

What is the total manufacturing overhead cost for

February?

O a. $2,725

O b. $2,950

0 c. $2,800

O d. $2,675

All of the following are advantages of the use of

budgets in a management control system except

that budgets:

O a. promote communication among staff.

O b. mainly consider financial outcome.

O c. provide performance criteria for

management.

d. force management to plan.

Which of the following statements represents

Margin of Safety (units)?

O a. Expected sales (units) less actual sales

(units)

O b. Expected sales (units) less production

(units)

O c. Expected sales (units) add break-even

(units)

d. Expected sales (units) less break-even

(units)

A business plans to make 15,000 coats per annum,

each taking the 1.5 direct labour hours. If the direct

labour rate is $8 per hour, what is the total annual

direct labour budget?

O a. $193,500

O b. $207.000

O c.

$180,000

O d. $120,000

A company has sales of $240,000, total fixed costs of

$40,000, and a contribution ratio of 30%. What is its

profit?

O a. $40,000

O b. $72,000

c.

$32.000

O d. $128.000

What is the correct order for preparing the

following budgets?

1.

Material budget

II. Cash budget

Ill.

Sales budget

IV.

Overhead budget

Oa.

INI. I. I. IV

Ob.

1, 11, 111, IV

O C

11, 1, IV, Il

O d.

HI, IV, 1, Il

If selling price is $5,000, contribution margin per

unit is $1,000, then contribution margin percentage

or ratio will be:

a. 20%

O b. 5%

Oc.

12%

O d. 15%

Budgeted sales for the second quarter

year are as follows:

April

$180,000

May

$200,000

June

$150,000

The company collects 20 percent in the month of

sale, 70 percent in the first month following the sale,

and 10 percent in the second month following the

sale. Total cash collected in June will be:

O a. $193,000

O b. $190,000

0 c. $188,000

O d. $197,000

Assume the following cost behaviour data for

Portrait Company:

Sales price:$18.00 per unit :

Variable costs:$$13.50 per unit

Fixed costs:$22,500

Tax rate: 40%

What volume of monetary sales is required to earn

an after-tax income of $27,000?

a. $270,000

O b. $90,000

O c. $180,000

O d. $198,000

Baxcover has forecasted sales in units for its Dutch

Pots to be April 500, May 480 and June 450. The

variable selling rate is $5 per unit. The Company also

has fixed cost of $10,250 per month which includes

$500 for depreciation. What is the cash

disbursement for selling and administrative expense

for the Month of June?

O a. $9,750

O b. $9,500

c. $12,000

O d. $12,500

Baker Company sells its product for $60. In addition,

it has a variable cost ratio of 40 percent and total

fixed costs of $9,000. How many units must be sold

in order to obtain a before-tax profit of $12,000,

rounded up to the nearest whole number?

a.

584 units

O b. 350 units

Oc.

333 units

O d. 875 units

Choices Unlimited has the following purr orior

budget for the last half of 2022:

July:$100,000

August :$80,000

September:$110,000

October:$90,000

November:$100,000

December:$94.000

Historically, the company pays one half at the time of

purchase and the remainder in the month following

purchase. What is the expected cash disbursements

for August?

a. $90,000

O b. $95,000

O c. $80,000

The break-even point will increase in all the

situations noted below EXCEPT for when:

O a. selling price decreases.

b. contribution margin per unit increases.

Oc.

otal fixed cost increases.

O d. variable cost increases.

The break-even point will increase in all the

situations noted below EXCEPT for when:

O a. selling price decreases.

b. contribution margin per unit increases.

Oc. total fixed cost increases.

O d. variable cost increases.

A company is preparing the production budget for

the second quarter. Projected sales (in units) are as

follows: April 600 May 680 and June 750 The

company's policy is to have finished goods stock of

20% of the next month's projected sales. Assuming

that there was no opening stock for April, what

should be the production quota for May?

O a. 680 units

b.

694 units

Oc.

666 units

O d. 830 units

When a company is operating above the break-even

point, the degree or amount that revenues may

decline before losses are incurred is the:

Oa.

contribution margin

O b. profit

OC.

margin of safety

O d. gross margin

When a company is operating above the break-even

point, the degree or amount that revenues may

decline before losses are incurred is the:

O a. contribution margin

O b. profit

0 c. margin of safety

O d. gross margin

If contribution margin per unit decreases, selling

price per unit and total fixed cost remain constant,

break -even point in units will:

O a.

vary

O b. decrease

Oc.

constant

O d. increase

Cake World specializes in red velvet cakes.

Budgeted production for the third quarter of 2021

iS:

July

5,000

August

16,000

September

7.000

The standard material required for each cake is 2lbs.

The company wants to have raw material on hand to

equal 20% of the following month's production

needs. Direct material to be purchased in August is:

O a. 14,800 Ibs

b. 12,400 Ibs

O c. 17,200 Ibs

O d. 10,000 Ibs