QUIZ MANAGEMENT ACCOUNTING I 2020

Name and Student Number

Evaluate responses using AI:

OFF

Budgeting is used to help companies:

• plan to better satisfy customers

• anticipate potential problems

• focus on opportunities

• All of these answers are correct

Budgeting provides all of the following EXCEPT:

• a means to communicate the organization's short-term goals to its members

• support for the management functions of planning and coordination

• a means to anticipate problems

• an ethical framework for decision making

A company's actual performance should be compared against budgeted amounts for the same accounting period so that:

• adjustments for future conditions can be included

• no feedback is possible

• no feedback is possible

• rolling budget can be implemented

Bowden Corporation used the following data to evaluate their current operating system. The company sells items for $20 each and used a budgeted selling price of $20 per unit.

Actual Budgeted

Units sold 46,000 units 45,000 units

Variable costs $225,400 $216,000

Fixed costs $47,500 $50,000

What is the static-budget variance of revenues?

• $20,000 favorable

• $20,000 unfavorable

• $2,000 favorable

• $2,000 unfavorable

Bowden Corporation used the following data to evaluate their current operating system. The company sells items for $20 each and used a budgeted selling price of $20 per unit.

Actual Budgeted

Units sold 46,000 units 45,000 units

Variable costs $225,400 $216,000

Fixed costs $47,500 $50,000

What is the static-budget variance of operating income?

• $10,600 favorable

• $10,600 unfavorable

• $13,100 favorable

• $13,100 unfavorable

A variance is:

• the gap between an actual result and a benchmark amount

• the required number of inputs for one standard output

• the difference between an actual result and a budgeted amount

• the difference between a budgeted amount and a standard amount

All of the following are needed to prepare a flexible budget EXCEPT determining the:

• budgeted variable cost per output unit

• budgeted fixed costs

• actual selling price per unit

• actual quantity of output units

The direct materials efficiency variance is computed as

• (SP X AQ) - (AP X SQ).

• (AP X AQ) - (SP X SQ).

• (SP X AQ) - (SP X SQ).

• (AP X SP) - (AQ X SQ)

The flexible-budget variance for direct cost inputs can be further subdivided into a:

• static-budget variance and a sales-volume variance

• sales-volume variance and an efficiency variance

• price variance and an efficiency variance

• static-budget variance and a price variance