Which is NOT a component of the master budget?
(Points : 3)
Sales budget
Capital budget
Cost of goods sold budget
Budget to actual variance analysis

(TCO 5) The
budgets that are comprehensive financial plans made up of various
individual departmental and activity budgets are the
(Points : 3)

operating budgets.
master budgets.
financial budgets.
continuous budgets.

(TCO 5) Which is responsible for directing and coordinating the overall budgeting process?
(Points : 3)

Budget committee
Budget director

(TCO 5) Which is a financial budget?
(Points : 3)

Cost of goods sold budget
Budgeted balance sheet
Marketing expense budget
Production budget

(TCO 5) A budget that is developed around the actual level of activity is
(Points : 3)

a static budget.
a continuous budget.
a flexible budget.
None of the above

(TCO 5) A budget that is developed around one particular level of activity is
(Points : 3)

a static budget.
a continuous budget.
an incremental budget.
None of the above

(TCO 5) Volume variances examine differences between
(Points : 3)

the static budget and actual costs.
the flexible budget and the static budget.
the static budget and the rolling budget.
None of the above

(TCO 5) The ideal budget system creates
(Points : 3)

extreme caution in managers.
drive and risk avoidance in managers.
drive and goal congruence in managers.
None of the above

(TCO 5) Participative budgeting has which potential problem?
(Points : 3)

Building slack into a budget
Encouraging individual behavior that is in basic conflict with the goals of the organization
Using budgets as a part of performance evaluations, which could lead to unethical behavior
Managers taking action that will improve performance in the short run but has long-term consequences

(TCO 5) Bored Manufacturing has projected the following.

Units to be produced


Direct materials

4 pounds at $5


Direct labor

1 hour at $8


Variable overhead

75% of direct labor

Fixed overhead

50% of direct labor

Which is the total amount of overhead included in the overhead budget?
(Points : 3)


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