FOCUS ON PERSONAL FINANCE LL/ACCESS >BI
6th Edition
ISBN: 9781260529326
Author: Kapoor
Publisher: McGraw-Hill Publishing Co.
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Chapter 2, Problem 10P
Summary Introduction
To compute: The variance and indicate whether it is a surplus or deficit.
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Fran Powers created following budget and reported actual spending listed. Calculate the variance for each catagory and indicate whether it is Deficit or Surplus:
Item Budggeted Actual Variance Deficit/Surplus
Food $360 $298Automobile $320 $334Housing $950 $982Clothing $110 $134Personal $275 $231
Which of the following budgets are prepared before the sales budget?
Budgeted Income Statement
Direct Labor Budget
A)
Yes
Yes
B)
Yes
No
C)
No
Yes
D)
No
No
Group of answer choices
Choice A
Choice B
Choice C
Choice D
Which one of the following is the incorrect statement regarding Budgets? Select one:
a. Budget is qualitative statement of policy
b. All are correct statement regarding budget.
C. Budget is a predetermined statement
d. Budget prepared for a defined period of time
Chapter 2 Solutions
FOCUS ON PERSONAL FINANCE LL/ACCESS >BI
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Which of the following statements correctly describes rela-tionships within the master budget? (More than one answer may be correct.)a. The production budgets are based in large part on thesales forecast.b. In many elements of the master budget, the amountsbudgeted for the upcoming quarter are reviewed andsubdivided into monthly budget figures. c. The operating budgets affect the budgeted income state-ment, the cash budget, and the budgeted balance sheet. d. The capital expenditures budget affects the direct mate-rials budget.arrow_forwardBulldogs Inc. wants to analyze the variances in its actual and budgeted gross profit. The following are available:· Actual gross profit and actual gross profit ratio is P600,000 and 25%, respectively.· The actual sales are P400,000 more than the total budgeted sales.· Budgeted sales price at actual quantity sold is P2,000,000What is the Sales Volume Variance under 4-way analysis?arrow_forwardBingo Inc. wants to analyze the variances in its actual and budgeted gross profit. The following are available:· Actual gross profit and actual gross profit ratio is P600,000 and 25%, respectively.· The actual sales are P400,000 more than the total budgeted sales.· Budgeted sales price at actual quantity sold is P2,000,000What is the Sales Volume Variance under 4-way analysis?arrow_forward
- Which of the following statements is True? a. Budget data are generally prepared by top management and distributed downward in anorganization b. The budget committee is responsible for preparing detailed budget figures in anorganization c. The primary purpose of the cash budget is to show the expected cash balance at the endof the budget period. d. Under zero-based budgeting, a manager is required to start at zero budget levels each period, as if the programs involved were being initiated for the first timearrow_forwardWhich of the following appears on the budgeted balance sheet? * A. estimated sales B. estimated cost of goods sold C. estimated fixed selling expense D. estimated ending accounts receivablearrow_forwardWhich of the following statements is true? It is recommended when making a budget to incorporate a conservative amount of slack to account for unexpected events. An example of an unfavorable variance is when actual expenses are less than budgeted expenses. Budgets are estimates for revenue and expenditures that are used to set, achieve, and evaluate an organization’s goals. Static budgets are generated at the beginning of the year and then subsequently updated for the actual level of volume that occurs during the period. An example of a favorable variance is when actual revenue is less than budgeted revenue.arrow_forward
- How do we end up with the Ending Inventory of $69112 on the budgeted balance sheet?arrow_forwardWhich of the following statements is true concerning the recording of a budget? Choose the correct.a. At the beginning of the year, debit Appropriations.b. A debit to the Budgetary Fund Balance account indicates an expected surplus.c. At the beginning of the year, debit Estimated Revenues.d. At the end of the year, credit Appropriations.arrow_forwardFran Bowen created the following budget: Food, $350 Clothing, $100 Transportation, $320 Personal expenses and recreation, $275 Housing, $950 She actually spent $298 for food, $337 for transportation, $982 for housing, $134 for clothing, and $231 for personal expenses and recreation. Calculate the variance for each of these categories, and indicate whether it was a deficit or a surplus.arrow_forward
- Explain zero-based budgeting and how it differs from the traditional approach to preparing next years budget.arrow_forwardWhich of the following is not an operating budget? A. sales budget B. production budget C. direct labor budget D. cash budgetarrow_forwardDickinsen Company gathered the following data for December: a.Compute the revenue price variance. b.Compute the revenue volume variance. c.Compute the total revenue variance.arrow_forward
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