chapter 8 smartbook part #2

Question 1

The first step in the budgeting process is the preparation of the ________budget

Answer 1

sales/revenue

Question 2

_______ involves the steps taken by management to increase the likelihood that all parts of the organization are working to achieve the goals set down in the planning stage.

Answer 2

planning

Question 3

involves the steps taken by management to increase the likelihood that all parts of the organization are working to achieve the goals set down in the planning stage.

Answer 3

control

Question 4

Budgetary slack occurs when a manager submits a budget that is Blank______.

vague

too easy to attain

too difficult to attain

much like budgets submitted over the previous few years

Answer 4

too easy to attain

Question 5

A company can consider making investments or repay outstanding principal and interest when ______.

the cash excess is less than the minimum required cash balance

there is a cash deficiency

the cash excess is greater than the minimum required cash balance

the cash excess equals the minimum required cash balance

Answer 5

the cash excess is greater than the minimum required cash balance

Question 6

Because all other parts of the budget depend on it, if the Blank______ budget is inaccurate, the rest of the budget will be inaccurate.

direct materials

cash

production

sales

Answer 6

sales

Question 7

In a manufacturing company, the ______budget is used to determine the direct materials budget, the direct labor budget, and the manufacturing overhead budget. (Enter only one word per blank.)

Answer 7

production

Question 8

Limitations of self-imposed budgeting include Blank______.

Answer 8

suboptimal budget recommendations

budgetary slack

Question 9

Both the production and selling and administrative expense budgets are prepared using information directly from the _________.

Answer 9

sales budget