ACC 213 Check 4 - ANSWER KEY PDF

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WEEK 1-ULOd. Describe the budgeting framework and develop a master budget.Let’s CheckActivity 1. Please encircle the letter under each item that best reflects your answer. Which of the following is not a primary purpose of preparing a budget? a. To make sure the company expands its operation. b. To ...

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WEEK 1-3 ULOd. Describe the budgeting framework and develop a master budget.

Let’s Check Activity 1. Please encircle the letter under each item that best reflects your answer. 1. Which of the following is not a primary purpose of preparing a budget? a. To make sure the company expands its operation. b. To provide a basis for comparison of actual performance. c. To communicate the company’s plans throughout the entire business organizations. d. To control income and expenditures in a given period. 2. These statements are proper to the budgeting process except a. It is a part of management’s responsibility to plan the use of its resources. b. Actual results need not be compared with plan, since the process ends after the budget is approved. c. It is a tool to orchestrate of various levels of individuals in the company is necessary to gain acceptance and attain its goals. d. The involvement of various levels of individuals in the company is necessary to gain acceptance and attain its goals. 3. The starting point in the preparation of an annual as well as monthly master budget prepared by the Budget Committee is the a. Cash budget c. Balance sheet budget b. Production budget d. Sales budget 4. A planning calendar in budgeting is the a. calendar period covered by the budget b. schedule of activities for the development and adoption of the budget c. calendar period covered by the annual budget and the long-range plan d. sales forecast by months in the annual budget period 5. Budgetary slack can best be described as a. the elimination of certain expenses to enhance budgeted income. b. the planned overestimation of budgeted expenses. c. a plug number used to achieve a preset level of operating income. d. the planned underestimation of budgeted expenses. 6. In a master budget plan, sales forecast is under a. Financial budget c. Performance budget b. Operating budget d. Capital budget 7. Which of the following is normally included in the financial budget of firm? a. Direct materials budget c. Budgeted balance sheet b. Selling expenses budget d. Sales budget 8. Which one of the following items is the last schedule to be prepared in the normal budget preparation process? a. Cost of goods sold budget c. Selling expense budget b. Manufacturing overhead budget d. Cash budget 9. Which of the following may be considered an independent item in the preparation of the master budget? a. Ending inventory budget

b. Capital investment budget c. Pro-forma statement of financial position d. Pro-forma income statement...