budgeting is when budgets are formulated with the active.doc

budgeting is when budgets are formulated with the active participation of all affected employees A. Financial B. Team C. Participative D. Shared Question 3 Important factors considered by sales forecasters include all of the following except _____. A. past pattern of sales B. marketing research studies C. competitors' activities D. the desired level of sales Question 4 A major drawback of using historical results for judging current performance is that _____. A. past results may be incorrect B. results may refer to a different manager C. inefficiences may be concealed in the past performance D. all of these answers are correct Question 5 _____ is generally prepared as the first step in preparing the operating budgets. A. A sales budget B. An operating expense budget C. A purchases budget D. A budgeted income statement Question 6 Cheating may take the form of _____.: A. making short-run decisions to increase profits that are not in the company's best long-run interests B. creating budgetary slack C. decreasing profits when actual profits are significantly exceeding the profit target D. all of these answers are correct Question 7 An example of a favorable variance is _____. A. actual revenues are less than expected B. actual expenses are less than expected C. material prices are greater than expected D. expected labor costs are less than actual costs Question 8 Differences between the static budget and the flexible budget are due to _____. A. problems of cost control B. poor usage of material and labor C. a combination of price and material variances D. actual activity differing from expected activity levels Question 9 The type of budget that serves as the original benchmark for evaluating performance is called a _____ budget. A. balanced B. cost C. flexible D. static Question 10 Activity-level variances plus flexible-budget variances equals _____. A. total static-budget variances B. total standard variances C. total actual variances D. none of these answers is correct Question 11 Efficiency is indicated by _____. A. sales-activity variances B. static-budget variances C. flexible-budget variances D. all of these answers are correct Question 12 Effectiveness is indicated by _____. A. sales-activity variances B. static-budget variances C. flexible-budget variances D. all of these answers are correct Question 13 Green Company planned to produce 12,000 units. Processing required 16,000 machine hours at a cost of $15,000 + $10.50 per machine hour. Actual sales were 14,000 units requiring 20,000 machine hours. Actual processing cost was $222,000. _____ is the static-budget variance for processing. A. $39,000 favorable B. $39,000 unfavorable C. $42,000 favorable D. $42,000 unfavorable $222,000 – [$15,000 + (16,000 x $10.50)] = $39,000 (U)Question 14 Roger Company planned to produce 12,000 units. Processing required 16,000 machine hours at a cost of $15,000 + $10.50 per machine hour. Actual sales were 14,000 units requiring 20,000 machine hours. Actual processing cost was $222,000. _____ is the activity-level variance for processing. A. $39,000 favorable B. $39,000 unfavorable C. $42,000 favorable D. $42,000 unfavorable [(20,000 x $10.50) + $15,000] – [(16,000 x $10.50) + $15,000] = $42,000 (U)Question 15 Identify which statement below would not be a possible reason for a variance between a flexible budget and actual results. A. Material prices were different than expected B. Labor prices were different than expected C. The actual volume of activity was different than expected D. The amount of labor used per unit of output was different than expected Question 16 Flexible budgets help to measure the _____. A. differences between projected and actual activity levels B. efficiency of operations at the actual activity level C. amount by which standard quantity and expected prices differ D. reasons why projected activity levels were not attained Question 17 A standard cost is a unit cost that _____. A. should never be revised B. is the average cost for the industry C. the company attained for the most recently completed period D. should be attained Question 18 The following information is for Brooklyn Corporation: Direct Material Standard price per unit of input $29 Actual price per unit of input $27 Standard inputs allowed per unit of output 3 pounds Actual units of input used 9,000 pounds Actual units of output 3,000 units * Direct material is measured in pounds _____ is the direct-material price variance. A. $6,000 favorable B. $6,000 unfavorable C. $18,000 unfavorable D. $18,000 favorable 9,000 x ($29 - $27) = $18,000 (F)Question 19 The following information is for Euclid Corporation: Direct Material Standard price per unit of input $25 Actual price per unit of input $24 Standard inputs allowed per unit of output 3 pounds Actual units of input used 8,300 pounds Actual units of output 2,770 units * Direct material is measured in p。