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Finance 20 Multiple Choice Questions

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Question;An organization's budgets will often be prepared to cover:one month.?one quarter.?one year.?periods longer than one year.?All of these.Darling Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended:?Actual units produced: 12,000?Actual variable overhead incurred: $730,000?Actual machine hours worked: 60,000?Budgeted fixed overhead $72,000?Planned level of machine-hour activity 50,000?If Darling estimates four hours to manufacture a completed unit, the company's standard fixed overhead rate per machine hour would be:$12.00.??$14.40.??$14.60.??$15.00.some other amount.Trois Elles Corporation recently prepared a manufacturing cost budget for an output of 50,000 units, as follows:?Direct materials $100,000?Direct labor 50,000?Variable overhead 75,000?Fixed overhead 100,000?Actual costs incurred were: direct materials, $110,000, direct labor, $60,000, variable overhead, $100,000, and fixed overhead, $97,000. If Trois Elles evaluated performance by the use of a flexible budget, a performance report would reveal a total variance of:$3,000 favorable.??$23,000 favorable.??$27,000 unfavorable.??$42,000 unfavorable.??none of these amounts.Digregory makes all purchases on account, subject to the following payment pattern:?Paid in the month of purchase: 30%?Paid in the first month following purchase: 60%?Paid in the second month following purchase: 10%?If purchases for January, February, and March were $200,000, $180,000, and $230,000, respectively, what were the firm's budgeted payments in March?$69,000.??$138,000.??$177,000.??$197,000.??Some other amount.Which of the following budgets is based on many other master-budget components?direct labor budget.?overhead budget.?sales budget.?cash budget.?selling and administrative expense budget.?Quattro began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale, 60% are collected in the first month after sale, and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for May?$21,000.?$60,000.?$69,000.?$75,000.?Some other amount.Bird plans to sell 5,000 units each quarter next year. During the first two quarters each unit will sell for $12, during the last two quarters the sales price will increase $1.50 per unit. What is Bird's estimated sales revenue for next year?$240,000.?$255,000.?$270,000.?$244,000.?Some other amount.?A formal budget program will almost always result in:higher sales.?more cash inflows than cash outflows.?decreased expenses.?improved profits.?a detailed plan against which actual results can be compared.?Yorkley Corporation plans to sell 41,000 units of its single product in March. The company has 2,800 units in its March 1 finished-goods inventory and anticipates having 2,400 completed units in inventory on March 31. On the basis of this information, how many units does Yorkley plan to produce during March?40,600.?41,400.?43,800.?46,200.?Some other amount.?Martin Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended:?Actual units produced: 9,000?Actual variable overhead incurred: $54,400?Actual machine hours worked: 16,000?Standard variable overhead cost per machine hour: $3.50?If Martin estimates two hours to manufacture a completed unit, the company's variable-overhead efficiency variance is:$1,600 favorable.??$1,600 unfavorable.??$7,000 favorable.??7,000 unfavorable.??some other amount not listed above.Verna's makes all sales on account, subject to the following collection pattern: 20% are collected in the month of sale, 70% are collected in the first month after sale, and 10% are collected in the second month after sale. If sales for October, November, and December were $70,000, $60,000, and $50,000, respectively, what was the budgeted receivables balance on December 31?$40,000.?$46,000.?$49,000.?$59,000.?Some other amount.Interspace Merchandising anticipated selling 29,000 units of a major product and paying sales commissions of $6 per unit. Actual sales and sales commissions totaled 31,500 units and $182,700, respectively. If the company used a static budget for performance evaluations, Interstate would report a cost variance of:$6,300U.?$6,300F.?$8,700U.?$8,700F.?some other amount not listed above.The comprehensive set of budgets that serves as a company's overall financial plan is commonly known as:an integrated budget.?a pro-forma budget.?a master budget.?a financial budget.?a rolling budget.?A company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a:pro-forma budget.?master budget.?financial budget.?profit plan.?capital budget.Wilson Corporation is budgeting its equipment needs on an ongoing basis, with a new quarter being added to the budget as the current quarter is completed. This type of budget is most commonly known as a:capital budget.?rolling budget.?revised budget.?pro-forma budget.?financial budget.?The budgeted income statement, budgeted balance sheet, and budgeted statement of cash flows comprise:the final portion of the master budget.?the depiction of an organization's overall actual financial results.?the first step of the master budget.?the portion of the master budget prepared after the sales forecast and before the remainder of the operational budgets.?the second step of the master budget.?A manufacturing firm would begin preparation of its master budget by constructing a:sales budget.?production budget.?cash budget.?capital budget.?set of pro-forma financial statements.Generally speaking, budgets are not used to:identify a company's most profitable products.?evaluate performance.?create a plan of action.?assist in the control of profit and operations.?facilitate communication and coordinate activities.?Del's Diner anticipated that 84,000 process hours would be worked during an upcoming accounting period when, in fact, 90,000 hours were actually worked. One of the company's cost functions is expressed as follows:?Y = $16PH + $640,000 where PH is defined as process hours?What is Del's flexible budget for the preceding cost function?$1,280,000??$2,080,000??$1,984,000??$1,221,000??$2,112,000A budget serves as a benchmark against which:actual results can be compared.?allocated results can be compared.?actual results become inconsequential.?allocated results become inconsequential.?cash balances can be compared to expense totals.?

 

Paper#49214 | Written in 18-Jul-2015

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