Budgeting

Question 1

Determining the specific objectives and means by which strategic plans ill be achieved. Cover periods up to 18 month:

Answer 1

Operational and tactical planning

Question 2

Set below expectations to motivate productivity and efficiency and are revised periodically:

Answer 2

Standards

Question 3

Represent the costs that result from perfect efficiency and effectiveness

Answer 3

Ideal standards

Question 4

Represent costs that result from work performed by employees with appropriate training and experience but without extraordinary effort

Answer 4

Currently attainable standards

Question 5

Set exclusively by management

Answer 5

Authoritative standards

Question 6

Set by booth managers and the individuals who are held accountable to those standards

Answer 6

Participative standards

Question 7

The ultimate output of the annual business plan is the:

Answer 7

Pro forma financial statements

Question 8

Established to describe the resources needed and the manner in high those resources will be acquired:

Answer 8

Operational budgets

Question 9

Operational budgets include what 4 budgets:

Answer 9

Sales
Production
Selling and administrative
Personnel

Question 10

Define the detailed sources and uses for funds to be used in operations

Answer 10

Financial budgets

Question 11

What two items are included in the financial budgets:

Answer 11

Pro forma financial statements

Cash budgets

Question 12

Order of the budgets:

Answer 12

Sales budget
Production budget & Selling and administrative budget
DM budget & DL budget & Factover Overhead budget
Cost of Goods Sold Budget
Cash budget

Question 13

Formula for calculating the budgeted level of production:

Answer 13

Budgeted sales + ending inventory - beginning inventory

Question 14

Formula for calculating the number of units to be purchased:

Answer 14

Units of DM needed for production + ending inventory - beginning inventory

Question 15

Formula for calculating the cost of units to be purchased:

Answer 15

Units of DM to be purchased for the period X cost per unit

Question 16

Formula to calculate the cost of materials used:

Answer 16

Beginning inventory cost + purchases at cost - ending inventory cost

Question 17

Formula for calculating the total labor wages:

Answer 17

Budgeted production units X hours required per unit = total number of hours needed
Total hours needed X hourly wage rate = total labor wages

Question 18

Formula to calculate the cost of goods sold:

Answer 18

Cot of goods manufactures + beginning finished goods inventory - ending finished goods inventory

Question 19

Combined cash budget formula:

Answer 19

Beginning cash + cash collections from sales - cash disbursement from purchases = Ending Cash

Ending cash - cash requirements to sustain operations = working capital