ACCOUNTING 205 DEPARTMENT FINAL
EXAM QUESTIONS WITH COMPLETE
ANSWERS { GRADED A+}
Which kind of budgets are most likely to experience budgetary slack?
a. Participative budgeting
b. Top-down budgeting
c. Bottom-up budgeting
d. Both A and C - ✔✔d. Both A and C
Which of the following can be concluded from a comparison between top-down
and bottom-up approaches to budgeting?
a. For greater protection against budgetary slack, the bottom-up approach is better
b. For a more efficient budget creation process, the bottom-up approach is better
,c. To achieve a higher budget commitment from operating management, the top-
down approach is better
d. For a more efficient budget creation process, the top-down approach is better -
✔✔d. For a more efficient budget creation process, the top-down approach is
better
In preparing a direct labor budget, the number of direct labor hours required is
calculated using the
a. sales forecast
b. production budget
c. direct materials budget
d. sales budget - ✔✔b. production budget
Which of the following is not an operating budget?
a. Direct labor budget
b. Sales budget
c. Production budget
d. Cash budget - ✔✔d. Cash budget
,In July, Dora Inc. had $150,000 in cash available to spend. Ending cash balance is
$112,000, and cash disbursements were $50,000. What is Dora's short-term
financing needs for July?
a. $150,000
b. $138,000
c. $212,000
d. $12,000 - ✔✔d. $12,000
Which of the following can lead to a favorable variance?
A. budgeted costs are less than actual costs
B. actual revenues exceed budgeted revenues
C. actual fixed overhead cost is greater than the budgeted fixed overhead cost
D. actual material purchase price is greater than the standard price - ✔✔B. actual
revenues exceed budgeted revenues
Genent Industries, Inc. (GII), developed standard costs for direct material and
direct labor. In 2015, GII estimated the following standard costs for one of their
major products, the 30-gallon heavy-duty plastic container.Standard Quantity
Standard Price Direct materials 0.30 pounds $20 per poundDirect labor 0.20 hours
, $12 per hour. During July, GII produced and sold 3,000 containers using 1,000
pounds of direct materials at an average cost per pound of $19 and 625 direct
manufacturing labor hours at an average wage of $11.75 per hour.
2. The direct material quantity variance during July is ________.
A. $1,000 unfavorable
B. $1,100 favorable
C. $2,000 unfavorable
D. $1,000 favorable - ✔✔C. $2,000 unfavorable
A standard which represents an efficient level of performance that is attainable
under expected operating conditions is called a(n)
A. ideal standard
B. loose standard
C. tight standard
D. normal standard - ✔✔D. normal standard
Which of the following is a reason for a favorable material price variance?
A. the purchasing manager bargaining effectively with suppliers
EXAM QUESTIONS WITH COMPLETE
ANSWERS { GRADED A+}
Which kind of budgets are most likely to experience budgetary slack?
a. Participative budgeting
b. Top-down budgeting
c. Bottom-up budgeting
d. Both A and C - ✔✔d. Both A and C
Which of the following can be concluded from a comparison between top-down
and bottom-up approaches to budgeting?
a. For greater protection against budgetary slack, the bottom-up approach is better
b. For a more efficient budget creation process, the bottom-up approach is better
,c. To achieve a higher budget commitment from operating management, the top-
down approach is better
d. For a more efficient budget creation process, the top-down approach is better -
✔✔d. For a more efficient budget creation process, the top-down approach is
better
In preparing a direct labor budget, the number of direct labor hours required is
calculated using the
a. sales forecast
b. production budget
c. direct materials budget
d. sales budget - ✔✔b. production budget
Which of the following is not an operating budget?
a. Direct labor budget
b. Sales budget
c. Production budget
d. Cash budget - ✔✔d. Cash budget
,In July, Dora Inc. had $150,000 in cash available to spend. Ending cash balance is
$112,000, and cash disbursements were $50,000. What is Dora's short-term
financing needs for July?
a. $150,000
b. $138,000
c. $212,000
d. $12,000 - ✔✔d. $12,000
Which of the following can lead to a favorable variance?
A. budgeted costs are less than actual costs
B. actual revenues exceed budgeted revenues
C. actual fixed overhead cost is greater than the budgeted fixed overhead cost
D. actual material purchase price is greater than the standard price - ✔✔B. actual
revenues exceed budgeted revenues
Genent Industries, Inc. (GII), developed standard costs for direct material and
direct labor. In 2015, GII estimated the following standard costs for one of their
major products, the 30-gallon heavy-duty plastic container.Standard Quantity
Standard Price Direct materials 0.30 pounds $20 per poundDirect labor 0.20 hours
, $12 per hour. During July, GII produced and sold 3,000 containers using 1,000
pounds of direct materials at an average cost per pound of $19 and 625 direct
manufacturing labor hours at an average wage of $11.75 per hour.
2. The direct material quantity variance during July is ________.
A. $1,000 unfavorable
B. $1,100 favorable
C. $2,000 unfavorable
D. $1,000 favorable - ✔✔C. $2,000 unfavorable
A standard which represents an efficient level of performance that is attainable
under expected operating conditions is called a(n)
A. ideal standard
B. loose standard
C. tight standard
D. normal standard - ✔✔D. normal standard
Which of the following is a reason for a favorable material price variance?
A. the purchasing manager bargaining effectively with suppliers
