Edition
MANAGERIAL 10th ACCOUNTING
Warren/Reeve/Duchac
Score Name Course
% Section
Chapter Test 6A
NOTE: Each of the 25 correct answers is assigned a weight of 4%.
A
FILL-IN-THE-BLANKPRINCIPLES AND TERMINOLOGY60%
TEST 17A (Concluded)
INSTRUCTIONS: Complete each of the following statements by writing the appropriate words in the Answers column. For Scoring 0. ____
STATEMENTS 0. 13. 1. 2. 3. The document that charts a course of future action for a business by outlining the plans of the business in financial terms is the .................. The objectives of budgeting include: ................................................................................................................. ................................................................................................................. .................................................................................................................
Answers budget
1. ____ 2. ____ 3. ____
4. 5. 6. 7. 8.
Giving information to employees about their performance relative to the goals they helped establish is called ............................................... An organizations budgetary unit led by a manager who has both authority over and responsibility for the units performance is a(n) ....... Defrag Cleaning Co. establishes its budget at several levels of activity. This type of budget is called a(n) _________ budget. ............. When budgets establish lower goals than may be possible, they are said to be padded or contain ............................................................... Parts Supply Co. prepares its budgets based on a single level of activity (23,000 units) of production. This type of budgeting is known
4. ____ 5. ____ 6. ____ 7. ____ 8. ____
TEST 17A (Concluded)
as ............................................................................................................ 9. 1012. 10. 11. 12. 13. Manufacturing operations require a series of budgets that are linked together in a(n) ....................................................................................... Production budgets are used to prepare the following budgets: ................................................................................................................. ................................................................................................................. ................................................................................................................. The budget that allows management to assess the effects of the individual budgets on profits for the year is the ..................................... 10. ____ 11. ____ 12. ____ 13. ____ 9. ____
14. 15.
The budget that summarizes plans for acquiring fixed assets is the . ... The budget that shows expected receipts (inflows) and payments (outflows) of cash for a week, month, or longer period is the ................
14. 15. ____ ____
PROBLEMPROBLEMS40% INSTRUCTIONS: Solve the following problems and record the answers in the Answers column. For Scoring 0. ____
Answers 0. Sales are expected to total 125,000 units, and no inventories are maintained. Production should total ....................................................... 125,000 units
1. Calculate the units to be produced, based on the following data:
219
Estimated units in beginning inventory ......... Estimated units in ending inventory .............. Expected units sold ....................................... 23.
90,000 75,000 500,000
1. ____
Minot Inc. plans to manufacture 60,000 units of Product T. Product T is produced in Department 1, where 0.40 hour per unit is required for direct labor. Direct labor rates in Department 1 are $25 per hour. The hours required in Department 1 to manufacture Product T are . .... The total direct labor cost to manufacture Product T is ......................... $ 2. ____ 3. ____
2. 3.
45. Davis Co.s accounts receivable on January 1, 2010, total $400,000. Budgeted sales for the first three months of the year are:
TEST 6A (Concluded)
January $600,000
February $750,000
March $800,000
Davis expects to sell 20% of its merchandise for cash. Of the remaining 80% of the sales on account, 60% is expected to be collected in the month of sale and the remainder in the following month. 4. 5. 68. Calculate Davis estimated cash receipts for January ........................... Calculate Davis estimated cash receipts for February ......................... Stewart Young Inc. uses a flexible budgeting system to plan for its manufacturing operations. The static budget for 20,000 units of $ $ 4. ____ 5. ____
production provides for direct labor at $12 per unit and variable electricity expense at $0.75 per unit. Fixed costs for the period are electric power $2,000 and supervisor salaries of $25,000. 6. 7. 8. 9. Variable costs for 22,000 units of production are .................................. Fixed costs for 22,000 units of production are ....................................... The total department costs for 23,000 units of production are .............. At the beginning of the period, the Assembly Department budgeted direct labor of $60,000 and supervisor salaries of $45,000 for 5,000 hours of production. The department actually completed 7,500 hours of production. Assuming that it uses flexible budgeting, the budget for $ $ $ $ 6. ____ 7. ____ 8. ____ 9. ____
TEST 6A (Concluded)
the department is ................................................................................... 10. Simmons Co. budgeted production of 52,000 plaques in 2010. Each plaque requires engraving. Assume that 15 minutes are required to engrave each plaque. If engraving labor costs $12.00 per hour, the direct labor cost budget for 2010 is ........................................................
$
10. ____