Planning Techniques Budgeting and Analysis

Question 1

What type of a budget is a single-use tactical plan?

Answer 1

Annual budget

Question 2

What budget documents specific short-term operating performance goals?

Answer 2

Master budget

Question 3

What does a master budget comprise of?

Answer 3

Operating and financial

Question 4

How many years is a master budget confined of?

Answer 4

1 year

Question 5

What are the different types of operating budgets?

Answer 5

Sales and production

Question 6

What are the different types of financial budgets?

Answer 6

Pro forma financial statements and cash budgets

Question 7

What budget is the foundation of the entire budget process?

Answer 7

Sales budget

Question 8

Calculation for budgeted production

Answer 8

Budgeted sales + Desired ending inventory - Beginning inventory

Question 9

Calculation for units of direct materials to be purchased for the period

Answer 9

Units of DM needed + Desired ending inventory - Beginning inventory

Question 10

What are the 3 major section of the cash budget?

Answer 10

Cash available, cash disbursements, and financing

Question 11

What are the 4 types of Strategic Business Units?

Answer 11

Cost, Revenue, Profit, and Investment

Question 12

What are the designs of financial scorecards?

Answer 12

Accurate, timely, understable, and specific accountability

Question 13

What are the 4 success factors of balanced scorecard?

Answer 13

Financial, internal business processes, customer satisfaction, and advancement of innovation

Question 14

Who are the authoritative standards exclusively set by?

Answer 14

Management

Question 15

What is the advantage of authoritative standards?

Answer 15

Implemented quickly

Question 16

What is the disadvantage of the authoritative standard?

Answer 16

Workers might not accept imposed standards

Question 17

Who are the participative standards set by?

Answer 17

Managers and the individuals

Question 18

What is the advantage of participative standard?

Answer 18

Workers are more likely to accept.

Question 19

What is the disadvantage of the participative standards?

Answer 19

Slower to implement

Question 20

What is derived from input received from numerous organizational resources?

Answer 20

Sales forecasts

Question 21

What are the elements of Cost of Goods Manufactured?

Answer 21

Direct labor, Direct material, and Factory overhead applied

Question 22

Calculation for Price Variance

Answer 22

Actual quantity purchased x Actual price vs. Actual quantity purchased x Standard price

Question 23

Calculation for quantity usage variance

Answer 23

Actual quantity used x Standard price vs. Standard quantity allowed x Standard price

Question 24

Calculation for Rate Variance

Answer 24

Actual hours x Actual price vs. Actual hours x Standard rate

Question 25

Calculation for Efficiency variance

Answer 25

Actual hours x Standard rate vs. Standard hours allowed x Standard rate

Question 26

Calculation for Spending Variance(overhead)

Answer 26

Actual overhead vs. Budget amount based on actual hours worked

Question 27

Calculation for Efficiency variance(overhead)

Answer 27

Budget amount based on actual hours worked vs. Budget amount based on standard hours allowed for production

Question 28

Calculation for Volume Variance(overhead)

Answer 28

Budget amount based on standard hours allowed for production vs. Overhead Applied to WIP