Which of the following statements concerning budget preparation for a merchandiser is​ correct?     A. Operating expenses differ from operating cash outflows solely as a result of timing differences between when an expense is incurred and when an expense is paid.   B. Only an understanding of cost behavior is required to prepare an operating expense budget.   C. If a company requires its ending inventory to equal a certain percentage of the cost of next​ month’s sales, the company would be able to prepare purchases budgets for 4 months if it only knew the cost of sales for those 4 months.   D. Assuming only a portion of a​ company’s sales are made on​ account, bad debt expense under the income statement method is calculated by multiplying sales on account by the estimated uncollectible percentage.   E. None of the above statements are correct.

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Crane Company has accumulated the following budget data for the year 2022. 1. Sales: 31,100 units, unit selling price $85. 2. Cost of one unit of finished goods: direct materials 1 pound at $5 per pound, direct labor 3 hours at $12 per hour, and manufacturing overhead $6 per direct labor hour. 3. Inventories (raw materials only): beginning, 10,100 pounds; ending, 15,100 pounds. 4. Selling and administrative expenses: $170,000; interest expense: $30,000. 5. Income taxes: 20% of income before income taxes.

Which of the following statements is not correct?   The revenue budget is the starting point in preparing the master budget.   The revenue budget is constructed by multiplying the expected sales in units by the sales price.   The production budget is not based on the revenue budget.   The cash budget is used to determine whether the firm will have enough cash on hand.

1. What is the total budgeted indirect cost at the Elmore store in January 2018​? What is the total budgeted cost of each activity at the Elmore store for January 2018​? What is the budgeted indirect cost of each product category for January 2018​? 2. Which product category has the largest fraction of total budgeted indirect​ costs? 3. Given your answer in requirement​ 2, what advantage does Maclin's Corner gain by using an​ activity-based approach to budgeting​ over, say, allocating indirect costs to products based on cost of goods​ sold?

Question 1

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…

Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expense Administrative expense* Total selling and administrative expenses Net operating income *Includes $28,000 of depreciation each month. April May June $ 600,000 $1,100,000 $ 560,000 420,000 770,000 392,000 180,000 330,000 168,000 111,000 48,000 159,000 105,000 46,000 64,800 44,000 169,800 108,600 90,000 $ 21,000 $ 160,200 $ 59,400 $ 48,000 July $460,000 322,000 138,000 67,000 41,600 b. Sales are 20% for cash and 80% on account. c. Sales on account are collected over a three-month period with 10%…

LB Enterprises (LB) is preparing its budget for the first quarter of 2019. LB's balance sheet as of December 31, 2018 is as follows: Assets Liabilities Cash $5,000 Accounts Payable $9500 Accounts Recievable 28,000 Inventories Direct Materials 8,100 Finished Goods (500 Units) 16,870 Stockholders Equity Equipment - gross 45,000 Accumulated depreciation 15.000 Common Stock $15,000 Net Equipment 30,000 Retained Earnings 63,470 Total Assets $87,970 Total Liabilities and $87,960 Equity LB sells one product for $45/unit. The Company forecasts that it will sell 2,000; 1,500; 1,600; and 1,700 units in January, February, March and April, respectively. • Sales to customers are all on credit. 40% of the cash for these sales is collected in the month of the sale and the remaining 60% is collected in the following month. LB wants finished goods inventory equal to 25% of the next month's sales on hand at the end of each month. LB wants direct materials equal to 75% of the current month's production…

If budgeted begin inventory is $20,600, budgeted ending inventory is $23,600, and budgeted cost of goods sold is $26,120, budgeted purchases should be?