Question : 61) Responsibility accounting a system that 61) ______ A) deals : 1196260

 

61) Responsibility accounting is a system that 61) ______ A) deals mainly with revenues. B) measures the plans and actions of responsibility centres. C) requires subdividing all management levels. D) is most appropriate at the top levels of the organization. E) is closely tied to the master budget.

62) Which of the following statements is FALSE concerning controllability of costs? 62) ______ A) Controllable costs are difficult to identify with much accuracy. B) Few costs are under the sole influence of any one manager. C) Variable costs are controllable costs. D) All costs are controllable, given a sufficiently long time period. E) Senior managers differ in their reliance on controllable costs for performance measurement.

63) A traditional criticism of traditional budgeting is “Excessive reliance on extrapolating past trends”. Which of the following is a proposal for change to address this criticism? 63) ______ A) adopt a cross-functional approach B) use activity-based-budgeting C) balance financial aspects with nonfinancial D) signal to all employees, the need for continuous improvement E) link budgeting explicitly to strategy

64) One of the criticisms of traditional budgeting is not using budgets to evaluate performance until the end of the budget period. Which of the following proposals for change would address this criticism? 64) ______ A) relying strictly on extrapolation of past performance B) link budgeting explicitly to strategy C) balance financial aspects with non-financial aspects (such as quality and time) D) inform employees of the need for continuous improvement in performance within the budget period E) use Kaizen budgeting to guide areas for cost reduction before the end of the budget period

65) Boone Hobbies, a wholesaler, has a sales budget for next month of $600,000. Cost of units sold is expected to be 40 percent of sales. All units are paid for in the month following purchase. The beginning inventory of units is $20,000, and an ending amount of $24,000 is desired. Beginning accounts payable is $152,000.

Cash used to pay accounts payable for the month totalled 65) ______ A) $152,000 B) $156,000 C) $244,000 D) $148,600 E) $240,000

Use the information below to answer the following question(s).

 

Copper Corporation has the following sales budget for the last six months of 2007:

 

July $200,000

 

October$180,000

August 160,000

 

November200,000

September220,000

 

December188,000

 

Historically, the cash collection of sales has been as follows:

65 percent of sales collected in month of sale,

25 percent of sales collected in month following sale,

8 percent of sales collected in second month following sale, and

2 percent of sales is uncollectible.

66) Cash collections for September are 66) ______ A) $161,400 B) $143,000 C) $204,000 D) $199,000 E) $240,000

67) What is the ending balance of accounts receivable for September assuming uncollectible balance is written off after the second month? 67) ______ A) $88,000 B) $89,800 C) $199,000 D) $97,000 E) $93,000

68) Cash collections for October are 68) ______ A) $199,000 B) $174,000 C) $176,400 D) $117,000 E) $184,800

69) The cash budget is a schedule of expected cash receipts and disbursements that 69) ______ A) is prepared immediately after the sales forecast. B) predicts the effect on the cash position at given levels of operations. C) is a self-liquidating cycle. D) requires an aging of accounts receivable and accounts payable. E) is prepared by the organization’s bank.

Use the information below to answer the following question(s).

 

Grinnell Manufacturing Company has the following information:

 

Month

Budgeted Sales

January

$76,000

February

85,000

March

 

92,000

April

79,000

Budgeted Expenses per Month

Wages

$15,000

Advertising

12,000

Depreciation

3,000

Other

4 percent of sales

Note: All cash expenses are paid as incurred.

70) What is the expected total cash disbursements for expenses in February? 70) ______ A) $34,400 B) $30,200 C) $32,000 D) $30,400 E) $30,000

 

71) What are the expected total cash disbursements for expenses in January? 71) ______ A) $30,000 B) $30,040 C) $29,000 D) $33,040 E) $28,200

72) What are the expected total cash disbursements for expenses in March? 72) ______ A) $27,000 B) $30,680 C) $30,040 D) $30,400 E) $32,000

 

 

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