Question

Please answer the following questions:

Q5 Material purchases on account would most likely be included in which budget?

a. Direct labor budget

b. Selling and administrative budget

c. Cash budget

d. None of the above

Q6 Out of the Park socks produce socks for sports fans. The socks come in two sizes: Medium and Large. Out of the Park anticipates the following sales volumes and prices for the coming period:

Size	Sales Volume	Selling Price
Medium	8,000 socks	$4.00 each
Large	10,000 socks	$5.00 each

What is the budgeted level of revenue for the coming period?

a. $50,000

b. $72,000

c. $82,000

d. $90,000

Q7 Out of the Park is projecting the following sales for January and February. Their policy is to maintain ending inventories at 5% of what is expected for the next month.

	Expected Sales
Style	January	February
Medium	1,000 units	1,800 units
Large	1,200 units	2,000 units

What is the budgeted level of production for both styles for January?

a. Medium: 1,040; Large: 1,240

b. Medium: 2,040; Large: 1,310

c. Medium: 2,240; Large: 1,440

d. None of the above

Q8 Olu’s African Sculptures is preparing their budgeted financial statements for the coming year, and has accumulated the following data:

Beginning-of-period balances:
Cash:	$65,000
Accounts Receivable:	$40,000
Raw Materials Inventory:	$30,000
Work in Process Inventory:	$150,000
Finished Goods Inventory:	$30,000
Equipment (historical value):	$275,000
Accumulated Depreciation:	$125,000
Accounts Payable:	$45,000
Estimates for end-of-period balances:
Accounts Receivable:	$20,000
Raw Materials Inventory:	$12,500
Work in Process Inventory:	$90,000
Finished Goods Inventory:	$8,000
Accumulated Depreciation:	$115,000
Accounts Payable:	$27,000
Budgeted activity levels for the period:
Sales (# units at a sales price of $205/unit):	20,000 units
Purchases of Direct Materials:	$290,000
Direct Labor Wages:	$170,000
Manufacturing Overhead:	$210,000
Selling and Administrative Expenses:	$775,000

What is the budgeted cash received from customers?

a. $4,100,000

b. $4,120,000

c. $4,220,000

d. $4,320,000

Answer 1