Question : 71. Fairway’s April sales forecast projects that 6,000 units will sell : 1225660

71. Fairway’s April sales forecast projects that 6,000 units will sell at a price of $10.50 per unit. The desired ending inventory is 30% higher than the beginning inventory, which was 1,000 units. Budgeted purchases of units in April would be: 

A. 6,000 units.

B. 7,000 units.

C. 6,300 units.

D. 7,300 units.

E. Some other amount.

72. The sales budget for Carmel shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units. Total budgeted sales of both products for the year would be: 

A. $42,000.

B. $200,000.

C. $264,000.

D. $464,000.

E. $500,000.

73. The sales budget for Carmel shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units. Budgeted purchases of Product A for the year would be: 

A. 22,400 units.

B. 20,400 units.

C. 20,000 units.

D. 19,500 units.

E. 12,200 units.

74. The sales budget for Carmel shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units. Budgeted purchases of Product B for the year would be: 

A. 24,500 units.

B. 22,500 units.

C. 16,500 units.

D. 26,500 units.

E. 20,500 units.

75. A quantity of merchandise or materials over the minimum needed that reduces the risk of running short is called: 

A. Just-in-time inventory.

B. Budgeted stock.

C. Continuous inventory.

D. Capital stock.

E. Safety stock.

76. Stritch Company is trying to decide how many units of merchandise to order each month. The company’s policy is to have 20% of the next month’s sales in inventory at the end of each month. Projected sales for August, September, and October are 30,000 units, 20,000 units, and 40,000 units, respectively. How many units must be purchased in September? 

A. 14,000.

B. 20,000.

C. 22,000.

D. 24,000.

E. 28,000.

77. If budgeted beginning inventory is $8,300, budgeted ending inventory is $9,400, and budgeted cost of goods sold is $10,260, budgeted purchases should be: 

A. $860

B. $1,100

C. $1,960

D. $9,160

E. $11,360

78. Barrett’s Fashions forecasts sales of $125,000 for the quarter ended December 31. Its gross profit rate is 20% of sales, and its September 30 inventory is $32,500. If the December 31 inventory is targeted at $41,500, budgeted purchases for the fourth quarter should be: 

A. $134,000.

B. $109,000.

C. $91,500.

D. $25,000.

E. $91,000.

79. When preparing the cash budget, all the following should be considered except: 

A. Cash receipts from customers.

B. Cash payments for merchandise.

C. Depreciation expense.

D. Cash payments for income taxes.

E. Cash payments for capital expenditures.

80. A plan that shows the expected cash inflows and cash outflows during the budget period, including receipts from loans needed to maintain a minimum cash balance and repayments of such loans, is called a(n): 

A. Capital expenditures budget.

B. Operating budget.

C. Rolling budget.

D. Cash budget.

E. Income statement.