Ch.24 Quiz

Instructions
Read the questions carefully.

This assessment is worth 100 points.

  1. One of the major benefits of formal budgeting is the positive effect it can have on employee attitudes.   (5 points)

      
      

  2. A budget is a formal statement of future plans, usually expressed in monetary terms.   (5 points)

      
      

  3. Past performance is the best overall basis for evaluating current performance and assessing the need for corrective action.   (5 points)

      
      

  4. The task of preparing a budget should be the sole task of the most important department in an organization.   (5 points)

      
      

  5. The budgets within the master budget must be prepared in a definite sequence as dictated by GAAP.   (5 points)

      
      

  6. The operating and financial budgets depend on information provided by the sales budget.   (5 points)

      
      

  7. A capital expenditures budget is prepared before the operating budgets.   (5 points)

      
      

  8. Part of the cash budget is based on information drawn from the capital expenditures budget.   (5 points)

      
      

  9. The financial budgets of a business include the cash budget, the budgeted income statement, and the budgeted balance sheet.   (5 points)

      
      

  10. The budgeted balance sheet is prepared with data contained in the previously prepared components of the master budget.   (5 points)

      
      

  11. The overall coordinating activity of the budget process is the responsibility of the:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  12. The set of periodic budgets that are prepared and periodically revised in the practice of continuous budgeting is called:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  13. The usual budget period is:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  14. A To determine the production budget for an accounting period, consideration is given to the:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  15. The amount budgeted for interest expense on short-term debt depends most directly on:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  16. Which of the following would not be used in preparing a cash budget for October?   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  17. A plan that reports the units or costs of merchandise to be purchased by a merchandising company during the budget period is called a:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  18. A department store has budgeted sales of $12,000 for its men's suits in September. Management wants to have $6,000 of suits in inventory at the end of the month to prepare for the winter season. Beginning inventory for September is expected to be $4,000. What is the dollar amount of merchandise purchases?   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  19. A plan that lists the types and amounts of selling expenses expected during the budget period is called a(n):   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  

  20. In preparing a budgeted balance sheet, the amount for Accounts Receivable is primarily determined from:   (5 points)

    a.  
    b.  
    c.  
    d.  
    e.  



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