Planning Techniques 2

Question 1

flexible budget

Answer 1

can be adjusted to reflect different levels of production

Question 2

master budget

Answer 2

is based on one specific level of production

Question 3

proper order to prepare budgets

Answer 3

Sales budget,

production budget,

budgeted income statement,

and budgeted balance sheet

Question 4

Direct Material, Direct Labor and OH

Answer 4

are all part of the production budget

Question 5

Cost-volume-profit analysis

Answer 5

is performed to determine the output quantity and other variables that should be used to maximize profits

Question 6

Cost-volume-profit analysis also

Answer 6

allows a flexibility so that different inputs and outputs can be factored in allowing management to determine the number of units to produce to increase net income

AKA Flexible Budgeting

Question 7

sales budget is considered the most important budget because

Answer 7

all other budgets in the process depend on the sales forecast

Question 8

The financial budget includes

Answer 8

1) capital expenditures budget
2) the cash budget
3) the budgeted balance sheet
4) the budgeted statement of cash flows

Question 9

Participative Budget

Answer 9

is a process NOT an actual budget