Copyright © 2015 John Wiley & Sons mentioning

Is always at the end of the chapter

A formal written statement of management’s plans for a specified future tim

Prepared by multiplying expected unit sales volume for each product times.

LENGTH OF THE BUDGET PERIOD

May be prepared for any period of time.

Budgeted Income Statement

Important end-product of the operating budgets.

Participative Budgeting

Each level of management should be invited to participate.

Primary benefit of budgeting

Provides definite objectives for evaluating performance.

studbud

Bebraaa

18 termsStudBud Administration19 plays

alo

Flashcards18 cardsFPractice quizPHost liveL

Questions 18

Answers

1
Direct Labor Budget
Shows the expected number of units to be sold in the upcoming period.
Calculates the fixed salaries of employees regardless of production lvls.
Critical in maintaining a labor force that can meet expected production.
Determines the total cost of all materials required for production.
2
Merchandisers
Does not use the manufacturing budgets
Relies on a direct labor budget to plan for inventory purchases.
Use the manufacturing budgets
Creates a manufacturing budget to calculate the cost of goods sold.
3
Production Budget
Indicates the number of units sold during the previous period.
Shows units must be produced to meet anticipated sales.
Lists only the raw materials required for production.
Shows the total revenue expected from anticipated sales.
4
Each of the following budgets is used in preparing the budgeted income statement except the
Selling and administrative budget.
Sales budget.
Capital expenditure budget.
Direct labor budget.
5
Goal of Par. Budgeting -eliminate budget not considered fair by auditors while still meeting corporate goals.
True
False
6
Cash Budget
Focuses only on the expected profits from sales.
Includes only long-term financial investments.
Indicates when excess cash will not be available.
Must prepare in sequence.
7
budgets are used as the basis for the preparation of the budgeted income statement
Long-range planning
Operating Budgets
Master budget
Sales forecast
9
WHAT IS A BUDGET
A projection of employee performance metrics for the next quarter
An informal agreement among managers to allocate resources
A formal written statement of management’s plans for a specified future tim
A detailed record of all past expenditures made by a company
10
Manufacturing Overhead Budget shows the expected manufacturing overhead costs for the budget period.
False
True
11
Not-for-Profit Organizations just as important as for profit-oriented company.
True
False
12
Sales Budget
Prepared by dividing the total revenue by the number of products sold.
Determined by estimating production costs and adding a fixed profit margin.
Prepared by multiplying expected unit sales volume for each product times.
Based solely on the previous year's sales figures without adjustments.
13
LENGTH OF THE BUDGET PERIOD
Should only be prepared for quarterly periods.
Must always cover exactly one calendar year.
May be prepared for any period of time.
Cannot be adjusted once it is set.
14
Any Questions?
True
False
15
Budgeted Income Statement
A summary of all cash inflows and outflows during the budget period.
A company’s total assets and liabilities at the end of the budget period.
A statement showing the company’s actual income for the current period.
Important end-product of the operating budgets.
16
Participative Budgeting
Set of related budgets constitutes a plan of action for a specified time.
Each level of management should be invited to participate.
Budgeting decisions are solely based on historical data without input.
Only top-level management is involved in the budgeting process.
17
Primary benefit of budgeting
Ensures guaranteed profit regardless of market conditions.
Allows unlimited spending flexibility for all departments.
Eliminates the need for performance reviews or adjustments.
Provides definite objectives for evaluating performance.
18
Budgeting enables disciplinary action to be taken at every level of responsibility.
True
False

Bebraaa Flashcards | StudBud

Bebraaa

18 termsStudBud Administration19 plays

alo

Flashcards18 cardsFPractice quizPHost liveL

Questions 18

Answers

1
Direct Labor Budget
Shows the expected number of units to be sold in the upcoming period.
Calculates the fixed salaries of employees regardless of production lvls.
Critical in maintaining a labor force that can meet expected production.
Determines the total cost of all materials required for production.
2
Merchandisers
Does not use the manufacturing budgets
Relies on a direct labor budget to plan for inventory purchases.
Use the manufacturing budgets
Creates a manufacturing budget to calculate the cost of goods sold.
3
Production Budget
Indicates the number of units sold during the previous period.
Shows units must be produced to meet anticipated sales.
Lists only the raw materials required for production.
Shows the total revenue expected from anticipated sales.
4
Each of the following budgets is used in preparing the budgeted income statement except the
Selling and administrative budget.
Sales budget.
Capital expenditure budget.
Direct labor budget.
5
Goal of Par. Budgeting -eliminate budget not considered fair by auditors while still meeting corporate goals.
True
False
6
Cash Budget
Focuses only on the expected profits from sales.
Includes only long-term financial investments.
Indicates when excess cash will not be available.
Must prepare in sequence.
7
budgets are used as the basis for the preparation of the budgeted income statement
Long-range planning
Operating Budgets
Master budget
Sales forecast
9
WHAT IS A BUDGET
A projection of employee performance metrics for the next quarter
An informal agreement among managers to allocate resources
A formal written statement of management’s plans for a specified future tim
A detailed record of all past expenditures made by a company
10
Manufacturing Overhead Budget shows the expected manufacturing overhead costs for the budget period.
False
True
11
Not-for-Profit Organizations just as important as for profit-oriented company.
True
False
12
Sales Budget
Prepared by dividing the total revenue by the number of products sold.
Determined by estimating production costs and adding a fixed profit margin.
Prepared by multiplying expected unit sales volume for each product times.
Based solely on the previous year's sales figures without adjustments.
13
LENGTH OF THE BUDGET PERIOD
Should only be prepared for quarterly periods.
Must always cover exactly one calendar year.
May be prepared for any period of time.
Cannot be adjusted once it is set.
14
Any Questions?
True
False
15
Budgeted Income Statement
A summary of all cash inflows and outflows during the budget period.
A company’s total assets and liabilities at the end of the budget period.
A statement showing the company’s actual income for the current period.
Important end-product of the operating budgets.
16
Participative Budgeting
Set of related budgets constitutes a plan of action for a specified time.
Each level of management should be invited to participate.
Budgeting decisions are solely based on historical data without input.
Only top-level management is involved in the budgeting process.
17
Primary benefit of budgeting
Ensures guaranteed profit regardless of market conditions.
Allows unlimited spending flexibility for all departments.
Eliminates the need for performance reviews or adjustments.
Provides definite objectives for evaluating performance.
18
Budgeting enables disciplinary action to be taken at every level of responsibility.
True
False