Budgeting and Accounting Quiz topic 10

What is the primary source of estimated cash receipts in the cash budget?

• Collections from current month’s sales

• Collections from prior month’s sales

• Interest revenue

• Cash sales

What is the main objective of budgeting?

• To compare actual results with the goals

• All of the above

• To execute plans to achieve the goals

• To establish specific goals

What is the main disadvantage of static budgets?

• They are not accurate

• They do not adjust for changes in activity levels

• They are time-consuming

• They are difficult to prepare

What is the purpose of the capital expenditures budget?

• To integrate operating and financing budgets

• To prepare the budgeted statement of financial position

• To summarize plans for acquiring fixed assets

• To estimate cash receipts and payments

What managerial function involves comparing actual performance against the budgeted goals?

• Planning

• Directing

• Executing

• Controlling

What is the main objective of participative budgeting?

• To create budgets that are more achievable

• To increase motivation and effort by employees

• All of the above

• To allow better information flow to top management

What is the budgetary period for operating activities?

• Quarter

• Fiscal year

• Month

• Week

What is the main purpose of the master budget?

• All of the above

• To integrate operating and financing budgets

• To provide information for a budgeted balance sheet

• To prepare a budgeted income statement

What is the estimated January 1, 2018, inventory for Elite Sports Enterprise?

• 3,500 units

• 2,570 units

• 5,000 units

• 3,000 units

What is the main purpose of the statement of financial position budget?

• To prepare the budgeted statement of financial position

• All of the above

• To indicate a weakness in financial position

• To revise the financing plans