Which of the following formulas best describes the merchandisepurchases budgets?a. Inventory to purchase = Budgeted ending inventory plus thebudgeted cost of sales plus budgeted beginning inventory.b. Inventory to purchase = Budgeted beginning inventory plus thebudgeted cost of sales less budgeted ending inventory.c. Inventory to purchase = Budgeted beginning inventory plus thebudgeted cost of sales plus budgeted ending inventory.d. Inventory to purchase = Budgeted ending inventory plus thebudgeted cost of sales less budgeted beginning inventory.

The correct answer is:d. Inventory to purchase = Budgeted ending inventory plus the budgeted cost of…

Answered: Which of the following formulas best…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 12MC: The units required in production each period are computed by which of the following methods? adding...

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Which of the following statements is not correct? A. The sales budget is computed by multiplying estimated sales by the sales price. B. The production budget begins with the sales estimated for each period. C. The direct materials budget begins with the sales estimated for each period. D. The sales budget is typically the first budget prepared.
Explain the role of a sales forecast in budgeting. What is the difference between a sales forecast and a sales budget?
The first step in preparing the sales budget is to a. prepare a sales forecast. b. review the production budget carefully. c. assess the desired ending inventory of finished goods. d. talk with past customers. e. increase sales beyond the forecast level.
Select the one budget below that is not an operating budget. a. Cost of goods sold budget b. Cash budget c. Production budget d. Overhead budget e. All of these.
Which one of the following is the equations is used in the production budget? Select one: a. Current period sale (in units) + Beginning inventory (in units) + Ending Inventory (Units) b. Current period sale (in units) + Beginning inventory (in units) - Ending Inventory (Units) c. Current period sale (in units) - Beginning inventory (in units) - Ending Inventory (Units) d. Current period sale (in units) - Beginning inventory (in units) + Ending Inventory (Units)
On the production budget, the number of units to be produced is computed as Select one: a. unit sales + desired end inventory + beginning inventory. b. unit sales - desired end inventory - beginning inventory. c. unit sales - desired end inventory + beginning inventory. d. unit sales + desired end inventory - beginning inventory. e. unit sales - cost of goods sold + beginning inventory. PreviousSave AnswersNext
When preparing a production budget, the required production equals: 1. budgeted sales+beginning inventory+desired ending inventory 2. budgetd sales-beginning inventory+desired ending inventory 3.budgeted sales-beginning inventory+desired ending inventory 4. budgeted sales+ beginning inventory-desired ending inventory
Which 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 receivable
The units required in production each period are computed by which of the following methods? Select one: a. adding beginning inventory, budgeted sales, and desired ending inventory b. adding beginning inventory to budgeted sales and subtracting desired ending inventory c. adding budgeted sales to the beginning inventory and subtracting the desired ending inventory d. adding budgeted sales to the desired ending inventory and subtracting beginning inventory
Which of the following is least likely to affect the preparation of the purchases budget? A.The amount of inventory stock available to purchase from suppliers. B.How easy it is to transport inventory from delivery trucks to the warehouse. C.The amount of warehouse space available. D.The shelf life of inventory.
What is not included in a sales budget for a retail business? A.expected sales in units B.selling price per unit C.expected ending inventory D.percentage of cash sales
Which of the following statements are true? Statement I. In a production budget, if the number of units in finished goods inventory at the end of the period is less than the number of units in finished goods inventory at the beginning of the period, then the expected number of units sold is less than the number of units to be produced during the period. Statement II. In the merchandise purchases budget, the required purchases (in units) for a period can be determined by subtracting the beginning merchandise inventory (in units) from the budgeted sales (in units) and desired ending merchandise inventory (in units). Statement III. When preparing a direct materials budget, beginning inventory for raw materials should be added to production needs, and desired ending inventory should be subtracted to determine the amount of raw materials to be purchased. Only Statement I is true. O Only Statement II is true. Statements I and II are true. Statements II and III are true. O None of the…

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