Question 1.1. Budgets are ___________________________.

a tool for management to use to penalize managers with poor performance
detailed financial plans that quantify future expectations and actions
busy work assigned to keep department managers from wasting valuable time on personal chores
a performance management tool that is automatically created by a firms accounting system once sales figures for the year are known.

Question 2. 2. All of the following are parts of a Master budget except a___________________.

sales budget
production budget
direct labor budget
balanced scorecard

Question 3. 3. Managers would prefer a budget prepared______________________________.
by the budget committee
utilizing the top-down approach
utilizing the bottom-up approach
utilizing none of the methods listed here

Question 4. 4. Padding a budget __________________________________.
is a smart use of company funds by a manager
does little to advance organizational efficiency
may induce wasteful spending
is impacted by more than one of the solutions listed here

Question 5. 5. Budgeting is _______________________________.
an exact science
going to involve the use of estimates
not going to ever produce a variance if properly prepared
never created using information from a previous period

Question 6. 6. Standards are ______________________________.
the predetermined expectations about the inputs required to achieve anticipated output.
the result of engineers and accountants trying to reach a targeted net income figure on the budget
singular in purpose
set so stringent that no manager can possibly achieve them

Question 7. 7. Production Standards should be set ______________________.
by the managerial accountant
by an engineer
by the production department manager
by some combination of the above individuals and possibly others not named here

Question 8. 8. When actual cost is more than planned __________________.
a favorable variance is produced
an unfavorable variance is produced
no variance is produced
there is no way to calculate which way the variance will fall without more information

Question 9. 9. The materials price variance reveals the difference between ____________________.
the price paid for materials and the quantity of materials used
the quantity of materials used and the quantity of materials allowed for good output
none of the solutions offered here
the standard price for materials purchased and the amount actually paid for those materials

Question 10.10. If the actual factory overhead applied is more than the actual factory overhead incurred _________.

a favorable variance is produced
an unfavorable variance is produced
no variance is produced
there is no way to calculate which way the variance will fall without more information