Question 1

Dickson Company has the following projected account balances for September 30 of the current year: $\begin{array}{lrlr}
\text { Accounts payable } & \$ 20,000& \text { Sales } & \$ 400,000 \
\text { Accounts receivable } & 50,000 &\text { Capital stock } & 200,000 \

\text { Depreciation, factory } & 12,000 &\text { Retained earnings } & 64,000 \
&&\text { (beginning) }\
\text { Finished Goods Inventories } & 90,000 &\text { Maintenance, factory } & 14,000 \
(8 / 31) & & \
\text { Finished Goods Inventories } & 90,000& \text { Cash } & 28,000 \
(9 / 30) \
\text { Materials used }& 100,000& \text { Equipment, net } & 120,000 \
\text { Office salaries } & 40,000& \text { Buildings, net } & 200,000 \
\text { Insurance, factory } & 2,000 &\text { Utilities, factory } & 8,000 \
\text { Factory wages } & 70,000 &\text { Selling expenses } & 30,000 \
\text { Bonds payable } & 80,000 &
\end{array}$ Required:
A. Prepare a budgeted income statement for the month ended September 30.
B. Prepare a budgeted balance sheet as of September 30.

Accepted Answer

The answer of Dickson Company has the following projected account...

Question 2

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Sales in units

Accepted Answer

The answer of Identify each item as a component of...

Question 3

Briefly describe the attributes of an ideal budgetary system. What features of budgeting have been identified that encourage positive behaviour?

Accepted Answer

The answer of Briefly describe the attributes of an ideal...

Question 4

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Beginning finished goods inventory

Accepted Answer

Beginning finished goods inventory is a component of the production budget, as it is used to calculate the number of units that need to be produced to meet demand and maintain desired ending inventory levels.

Question 5

Identify each item as an advantage or disadvantage of budgeting.
-Improves communication and coordination

Accepted Answer

Budgeting helps in improving communication and coordination within the organization, therefore it is considered as an advantage.

Question 6

Identify each item as either part of the operating budget or the financial budget.
-Budgeted income statement

Accepted Answer

Budgeted income statement is part of the financial budget, which focuses on the company's finances and includes financial statements such as cash flow statements, balance sheets, and income statements. The operating budget, on the other hand, focuses on the day-to-day operations of the company and includes budgets for expenses such as labor and materials.

Question 7

Yax Company expects sales of $40,000 in July, $50,000 in August, and $30,000 in September. The company's experience is that 40% of sales are cash, and the remainder are on account. Accounts receivable are paid: 70% in the month of sale, and 25% in the following month.
Required:
A. Calculate the expected cash receipts on accounts receivable in August for July sales.
B. Calculate the expected cash receipts on accounts receivable in August for August sales.
C. Calculate the total expected cash receipts on accounts receivable in August.
D. Calculate the total expected cash receipts in August.
E. Calculate how much of July sales are deemed to be uncollectible.

Accepted Answer

The answer of Yax Company expects sales of $40,000 in...

Question 8

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Unit selling price

Accepted Answer

The unit selling price is a component of the sales budget, which outlines the expected revenue from sales during a specific period of time.

Answer: G
 The unit selling price is used in determining the expected revenue for the sales budget, the amount of direct materials needed for the production budget, and the costs associated with purchasing those materials in the direct materials purchases budget. Therefore, it is a component of all three budgets.

Question 9

Identify each item as an advantage or disadvantage of budgeting.
-Provides standard for performance evaluation

Accepted Answer

Providing a standard for performance evaluation is an advantage of budgeting as it allows for measurement of actual performance against set targets and goals.

Question 10

Identify each item as an advantage or disadvantage of budgeting.
-Leads to budgetary slack

Accepted Answer

Budgetary slack refers to intentionally overestimating expenses or underestimating revenues in a budget in order to make it easier to achieve. This is a disadvantage because it can lead to inefficient use of resources and may result in missed opportunities for the organization.

Question 11

Is budgeting relevant for not-for-profit organizations? Explain your position.

Accepted Answer

The answer of Is budgeting relevant for not-for-profit organizations? Explain...

Question 12

Briefly describe the advantages and disadvantages of using budgeting for performance evaluation?

Accepted Answer

The answer of Briefly describe the advantages and disadvantages of...

Question 13

Describe some problems with participative budgeting.

Accepted Answer

The answer of Describe some problems with participative budgeting....

Question 14

Long & Short Company developed the following data for the month of June.
1 June 1 cash balance $2,300.
2 Cash sales in June $67,000.
3 Credit sales for June are $20,000; for May $10,000; and for April $16,000. Credit sales are collected as follows: 60% in the month of sale, 20% in the following month, and 10% in the second month following the sale.
4 Purchases for May were $34,000 and for June are $40,000. Half of purchases are paid in the month of purchase and the remainder in the following month.
5 June salaries are $28,400, utilities are $1,090, and depreciation on the building is $1,000.
Required:
A. Calculate the anticipated cash receipts from accounts receivable in June.
B. Calculate the anticipated total cash available in June.
C. Calculate the June cash payments for purchases.
D. Calculate the anticipated cash balance on June 30.

Accepted Answer

The answer of Long & Short Company developed the following...

Question 15

Identify each item as an advantage or disadvantage of budgeting.
-Forces managers to plan

Accepted Answer

Budgeting forces managers to plan their spending and income, helping them make informed decisions and avoid overspending. This can lead to more efficient use of resources and greater financial stability.

Question 16

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Units of direct materials needed for each unit of product

Accepted Answer

The units of direct materials needed for each unit of product are a component of the Direct materials purchases budget, as this budget determines the quantity of materials required to meet production needs.

Question 17

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Budgeted sales in dollars

Accepted Answer

Budgeted sales in dollars is a component of the Sales budget, which forecasts the expected sales revenue for a given period.

Answer: G
 Budgeted sales in dollars is needed to prepare both the production budget and direct materials purchases budget, as these budgets rely on the expected sales and production needs. Therefore, it is a component of all three budgets.

Question 18

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Beginning direct materials inventory

Accepted Answer

Beginning direct materials inventory is a component of the Direct materials purchases budget as it is used to calculate the amount of materials that need to be purchased.

Question 19

Identify each item as an advantage or disadvantage of budgeting.
-Pseudoparticipation

Accepted Answer

Pseudoparticipation is a form of fake participation where employees are asked to provide input on the budget, but it is not actually taken into consideration. This creates a negative work environment as employees feel that their opinions are not valued. Therefore, it is a disadvantage of budgeting.

Question 20

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all.
-Ending finished goods inventory

Accepted Answer

Ending finished goods inventory is a component of the production budget as it helps determine the number of units that need to be produced.

Quiz 9: Budgeting, Production, Cash, and Master Budget

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Sales in units

Briefly describe the attributes of an ideal budgetary system. What features of budgeting have been identified that encourage positive behaviour?

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Beginning finished goods inventory

Identify each item as an advantage or disadvantage of budgeting. -Improves communication and coordination

Identify each item as either part of the operating budget or the financial budget. -Budgeted income statement

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Unit selling price

Identify each item as an advantage or disadvantage of budgeting. -Provides standard for performance evaluation

Identify each item as an advantage or disadvantage of budgeting. -Leads to budgetary slack

Is budgeting relevant for not-for-profit organizations? Explain your position.

Briefly describe the advantages and disadvantages of using budgeting for performance evaluation?

Describe some problems with participative budgeting.

Identify each item as an advantage or disadvantage of budgeting. -Forces managers to plan

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Units of direct materials needed for each unit of product

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Budgeted sales in dollars

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Beginning direct materials inventory

Identify each item as an advantage or disadvantage of budgeting. -Pseudoparticipation

Identify each item as a component of one of the following budgets.* Each option may be used more than once, and it is possible that one or more of the options may not be used at all. -Ending finished goods inventory