The budget or schedule that provides necessary input data for the direct labor budget is the
Raw materials purchases budget
Production budget
schedule of cash collections
cash budget
Which of the following budgets are prepared before the sales budget
Choice A
Choice B
Choice C
Choice D
The excess or deficiency of cash available over disbursements on the cash budget is calculated as follows
The beginning balance less the expected cash receipts less the expected cash disbursements.
The cash available less the expected cash receipts plus the expected cash disbursements.
The beginning balance plus the expected cash receipts less the expected cash disbursements.
None of these
What are the 3 ways that Activity Based Costing differs from Traditional Costing?
ABC assigns both types of costs to products
ABC does not assign all manufacturing costs to products
Traditional Costing is more precise
ABC uses more cost pools
In ABC both manufacturing and non manufacturing costs are assigned to products (only on cause-and-effect basis).
ABC assigns ALL manufacturing and ALL non manufacturing costs.
An event that causes the consumption of overhead resources.
Costing
Activity
Budgeting
Planning
A "cost bucket" in which costs related to a single activity measure are accumulated.
Cost pool
Budget
An allocation base in an activity-based costing system.
Activity Cost Pool
Labor Hours
Activity Measure
Cost system
Simple count of the number of times an activity occurs
Transaction driver
Duration driver
A measure of the amount of time needed for an activity
Activity Based Costing relies only on allocation bases that are driven by the volume of production
providing power to run processing equipment would be a(n)
Unit-Level Activity
Batch-Level Activity
Customer-Level Activity
Organization-sustaining Activity
Product-Level Activity
setting up equipment and shipping customer orders are
Unity-Level Activity
designing or advertising a product would be:
Product Level Activity
sales calls and catalog mailings would be
heating a factory and cleaning executive offices are
Organization-sustaining activity
What is not a reason that companies may not use ABC for external reporting?
External reports are less detailed than internal reports
it may be difficult to make changes to the company's accounting system
ABC does not conform to GAAP (therefore 2 systems would be required)
Auditors may be suspect of the subjective allocation process based on interviews with employees
Costs are made less accurate
Ordinarily cover a one-year period corresponding to a company’s fiscal year. Many companies divide their annual budget into four quarters
Operating Budget
Perpetual Budget
12-month budget that rolls forward one month (or quarter) as the current month (or quarter) is completed. This approach keeps managers focused on the future at least one year ahead.
Operating budget
Perpetual budget
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