Caribbean Tool and Die Company’s forecasted sales for April; May; June; and July are $150,000; $225,000; $180,000; and $210,000; respectively. Sales are 50% cash and 50% credit with all accounts receivables collected in the month following the sale. Cost of goods sold is 60% of sales and ending inventory is maintained at $85,000 plus 20% of the following month’s cost of goods sold. All inventory purchases are paid 20% in the month of purchase and 80% in the following month.

Caribbean Tool and Die Company’s forecasted sales for April; May; June; and July are $150,000; $225,000; $180,000; and $210,000; respectively. Sales are 50% cash and 50% credit with all accounts receivables collected in the month following the sale. Cost of goods sold is 60% of sales and ending inventory is maintained at $85,000 plus 20% of the following month’s cost of goods sold. All inventory purchases are paid 20% in the month of purchase and 80% in the following month.

1)        Refer to Case 21-3. What are the cash collections budgeted for June? A)  $112,500

B) $180,000 C) $202,500 D)  $220,000

2)        Refer to Case 21-3. What are the budgeted cash payments in June for inventory purchases? A)  $86,400

B) $108,000 C) $126,000 D)  $170,280

3)        Refer to Case 21-3. What is the balance of accounts payable on the June 30 budgeted balance sheet? A)  $74,880

B) $89,280 C) $101,760 D)  $111,600

4)        Fast Foods has budgeted sales for June and July at $520,000 and $480,000, respectively. Sales are 80% credit, of which 50% is collected in the month of sale and 50% is collected in the following month. What is the accounts receivable balance on July 31?

A) $192,000 B) $240,000 C) $384,000 D)  $400,000

5)        What is the technique called that asks what a result will be if a predicted amount is not achieved or an underlying assumption changes?

A)      strategic analysis

B)       ratio analysis

C)       risk analysis

D)  sensitivity analysis

6)        Which of the following is NOT a responsibility center?

A)      cost center

B)       profit center

C)   equity center

D)   investment center

7)        In   a(n)                        center, a manager is ONLY accountable for expenses.

A)      investment center

B)       revenue center

C)       profit center

D)   cost center

8)        Which of the following is a responsibility center whose success is measured not only by its income, but also by relating that income to its invested capital?

A)   investment center

B)       cost center

C)       profit center

D)      revenue center

9)        What is the practice of directing executive attention to important deviations from budgeted amounts called?

A)   management by exception

B)       management by objective

C)       management by control

D)      management by analysis

10)    During April, Cherry Company had actual sales of $180,000 compared to budgeted sales of $195,000. Actual cost of goods sold was $135,000, compared to a budget of $136,500. Monthly operating expenses, budgeted at $28,000, totaled $25,000. Interest revenue of $2,500 was earned during April but had not been included in the budget. The performance report for April would show a net income variance of what amount?

A)   $8,000 B) $13,000 C)  $(8,000)

D)  $(13,000)

11)    During July, Neptune Company had actual sales of $144,000 compared to budgeted sales of $156,000. Actual cost of goods sold was $108,000, compared to a budget of $109,200. Monthly operating expenses, budgeted at $22,400, totaled $20,000. Interest revenue of $2,000 was earned during July but had not been included in the budget. The performance report for July would show a net income variance of what amount?

A)   $6,400 B) $10,400 C)  $(6,400)

D)  $(10,400)

Thanks