Module 5 Mastery Test

docx

School

Colorado State University, Global Campus *

*We aren’t endorsed by this school

Course

460

Subject

Accounting

Date

Feb 20, 2024

Type

docx

Pages

Uploaded by UltraSparrowPerson823

Question 1 1 / 1 pts ________ refers to the process of varying one or more budget inputs for the purpose of examining the resulting effects on a variable of interest. Sensitivity analysis Scenario analysis Budgetary analysis What-if analysis Correct! What-if analysis, within the context of budgeting, refers to the process of varying one or more budget inputs for the purpose of examining the resulting effect on a variable of interest (e.g., budgeted sales, operating income, or operating cash flows). Scenario analysis can be viewed as the result of simultaneously changing two or more inputs and examining the resulting effect on a variable of interest. Sensitivity analysis is the method that budget planners use to determine the extent to which a change in the forecasted valuer of one or more budgetary inputs affects individual budgets (i.e. how sensitive they are to a specific change.) Question 2 1 / 1 pts ________ entails a budgeting process that requires managers to prepare new budgets each period without relying on past results as a starting point. Activity-based budgeting Financial budgeting Zero-base budgeting (ZBB)

Flexible budgeting Correct! Zero-base budgeting (ZBB) is a budgeting process that requires managers to prepare budgets each period without relying on past results as a starting point. Question 3 1 / 1 pts Responsibility accounting is defined as an approach in which ________. the employee/manager with responsibility for a specific use of budgeted resources is evaluated on that basis the upper level executives take entire responsibility for the budget the entire company takes responsibility for the budget every employee is assigned responsibility for reviewing some other employee’s budget Correct! Responsibility accounting is an approach that attributes performance and evaluation only for those resources which are controllable by a specific employee/manager. Question 4 1 / 1 pts Which of the following is not one of the three key objectives of management compensation? To reduce the taxes of the firm and employee To motivate managers to work hard to achieve goals set by top management To provide an incentive for managers to make decisions that are aligned with the goals of the organization

To fairly reward managers for their effort and skill. Correct! The three key objectives are 1) to motivate managers to work hard, 2) to provide an incentive for managers to make decisions that are in the best interest of the organization, 3) to determine fairly the rewards earned by managers. Question 5 1 / 1 pts The final step in preparing a budget for a corporation is completed when ________. The board of directors has approved the budget The CEO has approved the budget The executives of budget units have examined the initial budget proposals The actual current year amounts have been compared to the budgeted amounts. Correct! The board of directors ultimately has final approval for the budget, and that approval is the last step in the budget preparation process. Question 6 1 / 1 pts Bagged Company manufactures reusable shopping bags and has budgeted sales of 36,000 bags. It has a targeted ending finished goods inventory of 6,000 bags, and beginning finished goods inventory of 1,800 bags. How many bags should be produced next year? 43,800 31,800

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

40,200 36,000 Correct! Budgeted production = budgeted sales + target ending finished goods inventory – beginning finished goods inventory. Thus, the calculation is: 36,000 + 6,000 - 1,800 = 40,200 bags Question 7 1 / 1 pts The required components of the master budget include all of the following except the ________. balanced scorecard budgeted income statement budgeted balance sheet operating budget Correct! The balanced scorecard is not a required component of the master budget; only the major financial statements and the operating budget are required. Incorrect Question 8 0 / 1 pts What component of management compensation is the fastest growing part of total compensation? (Adapted from the Blocher et al. (2022) textbook, question 20-13) Bonus Salary

Benefits Stock option Try again! Please review Chapter 20 in the Blocher et al. (2022) textbook, in the section entitled "Bonus Plans." Question 9 1 / 1 pts Bosch Corporation is headquartered in Germany. The company manufactures appliances and has predicted the following sales for its North American branch for four months of the current year: April 2021 May 2021 June 2021 July 2021 Sales in units* 1,700 1,900 2,100 1,600 Targeted ending inventory for each month should be 20% of the next month's sales, and the prior March 31 inventory was consistent with that target. How many units should be purchased in the calendar second quarter (April-June) of the year? (*real company but fictitious data for illustration purposes) 5,100 6,300 5,680 6,000 Correct! Note the calculation: purchases = (1,700 + 1,900 + 2100) + (1,600 x .20) - (1,700 x .20) = 5,680 units Question 10

1 / 1 pts Which of the following payment types allows a manager to purchase stock at some future date at a predetermined price? Deferred Bonus Performance Shares Stock options All of the above Correct! Only the stock option allows for the purchase of future shares at a predetermined price. The other two bonus types could include stock, but do not relate to the manager actually purchasing those shares at some future price.

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version