l>ACCT-202 Principles of Managerial Accounting - Practice Exam - Chapter 9
ACCT 202 Principles of Managerial AccountingPractice Exam - Chapter 9Profit PlanningDr. Fred Barbee
Select your answer by clicking on the switch next to each different. You willget immediate feedearlier. 1. Which of the complying with budgets involves the income-generating activities of the firm? a.Operating Budgetb.Financial Budgand so on.Capital Budgetd.All of the over. 2. Which of the adhering to is considered a financial budget? a.Selling and also Administrative Expense Budgetb.Direct Labor Budgand so on.Cash Budgetd.Sales Budget. 3. Of the budgets noted below, which is usually all set last? a.Production Budgetb.Cash Budgetc.Sales Budgetd.Manufacturing Overhead Spending Plan. 4. Which of the following statements is not correct? a.The sales budobtain is the starting suggest in preparing the grasp budget.b.The sales budgain is constructed by multiplying the supposed sales in units by the sales price.c.The sales budget mostly is accompanied by a computation of supposed cash receipts.d.Namong the above. 5. Budgeted production requirements are identified by: a.Adding budgeted sales in units to the desired EI in devices and deducting the BI.b.Adding budgeted sales in devices to the BI in units and also deducting the preferred EI in systems.c.Adding budgeted sales in units to the preferred ending inventory in devices.d.Deducting the start inventory in units from budgeted sales in units. 6. A continuous (or perpetual) budget: a.Is all set for a selection of task so that the budget deserve to be adjusted for transforms in task.b.Is a setup that is updated monthly or quarterly, dropping one period and adding an additional.c.Is a strategic arrangement that does not adjust.d.Is offered in suppliers that suffer no adjust in sales. Use the adhering to information to answer concerns 7 and also 8: Projected sales for Sommers, Inc. for the following year and start and ending inventory information are as follows: Sales 50,000 units; Beginning inventory 4,000 units; Desired finishing inventory 8,000 units. The offering price is $40 per unit. Each unit calls for 4 pounds of product which prices $6 per pound. The start inventory of raw materials is 12,000 pounds. The firm desires to have actually 3,000 pounds of product in inventory at the end of the year. 7. Sommers" budgeted sales would be: a.$2,160,000b.$2,320,000c.$2,480,000d.$2,000,000 8. According to Sommers" manufacturing budacquire, just how many kind of units need to be produced? a.54,000.b.46,000.c.62,000.d.38,000. 9. Budgeted sales for the initially quarter for Cullichild Company kind of, a retailer, are as follows: January 75,000 units; February 100,000 units; March 110,000 systems. Cullison began the year through an inventory of 7,500 systems. The company likes to maintain an inventory equal to 10% of next month"s budgeted sales. Budgeted purchases in units for February would be: a.111,000b.110,000c.101,000d.100,000 10. Brown, Inc. has budgeted $60,000 for annual fixed overhead costs for the coming year. Budgeted variable overhead is $0.10/unit. For the following quarter, Brvery own plans to manufacture 500,000 devices. Brown"s budgeted overhead for the quarter is: a.$50,000b.$65,000.c.$110,000.d.$150,000.Part II: Problems (To see the answer, click on the solution button.)Problem 1 The adhering to budacquire approximates have actually been ready by Clifton Company: CashReceipts CashPayments May $120,000 $150,000 June 110,300 150,000 The agency likes to maintain a minimum cash balance of $40,000. Any excess cash is invested in a money market account earning 9% compounded monthly. Interest is reinvested in the money market account. Any cash deficiencies are spanned by a withdrawal from the money industry account. If additional cash is required, the firm has actually a line of credit at 12% interemainder through the regional bank. Interemainder is paid monthly. Assume a cash balance on May 1 of $40,000, a money industry account balance of $0, and a crmodify line balance of $0. Required:Prepare a cash budgain for May and JuneProblem 2 The Good As Old Company type of manufactures antique-looking oak rocking chairs. Budgeted sales for the initially 5 months of the year are as follows: Bugeted Sales (Units) January 200 February 240 March 180 April 160 May 240 Each rocking chair needs 10 square feet of oak, at a expense of $20 per square foot. The agency desires to preserve an inventory of chairs equal to 25% of the complying with month"s sales. At the start of the year, 40 chairs are on hand also. Assume the firm maintains an inventory of oak equal to 10% of the following month"s requirements. At the beginning of the year, 240 square feet of oak are on hand. Inventory of oak at March 31 is estimated to be 180 square feet. Required: 1. Prepare a manufacturing budobtain, in systems, for each of the initially 4 months. 2.

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Prepare a purchases budgain, in dollars, for each of the initially three months.
Last Modified October 29, 2004