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Allscott Company is developing its budgets for 2019 and,for the first time,will use the kaizen approach.The initial 2019 income statement,based on static data from 2018,is as follows: Allscott Company is developing its budgets for 2019 and,for the first time,will use the kaizen approach.The initial 2019 income statement,based on static data from 2018,is as follows: Selling prices for 2019 are expected to increase by 8%,and sales volume in units will decrease by 10%.The cost of goods sold as estimated by the kaizen approach will decline by 10% per unit.Other than depreciation,all other operating costs are expected to decline by 5%. Required: Prepare a kaizen-based budgeted income statement for 2019. Allscott Company is developing its budgets for 2019 and,for the first time,will use the kaizen approach.The initial 2019 income statement,based on static data from 2018,is as follows: Selling prices for 2019 are expected to increase by 8%,and sales volume in units will decrease by 10%.The cost of goods sold as estimated by the kaizen approach will decline by 10% per unit.Other than depreciation,all other operating costs are expected to decline by 5%. Required: Prepare a kaizen-based budgeted income statement for 2019. Allscott Company is developing its budgets for 2019 and,for the first time,will use the kaizen approach.The initial 2019 income statement,based on static data from 2018,is as follows: Selling prices for 2019 are expected to increase by 8%,and sales volume in units will decrease by 10%.The cost of goods sold as estimated by the kaizen approach will decline by 10% per unit.Other than depreciation,all other operating costs are expected to decline by 5%. Required: Prepare a kaizen-based budgeted income statement for 2019. Selling prices for 2019 are expected to increase by 8%,and sales volume in units will decrease by 10%.The cost of goods sold as estimated by the kaizen approach will decline by 10% per unit.Other than depreciation,all other operating costs are expected to decline by 5%. Required: Prepare a kaizen-based budgeted income statement for 2019.

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It is best to compare this year's performance with last year's actual performance rather than this year's budget.

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The Japanese use the term kaizen when referring to________.


A) scarce resources
B) pro forma financial statements
C) continuous improvement
D) the sales forecast

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Computer-based systems,such as ERP systems,cannot perform calculations for financial planning models.

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Nantucket Industries manufactures and sells two models of watches,Prime and Luxuria.It expects to sell 3,200 units of Prime and 1,300 units of Luxuria in 2019.The following estimates are given for 2019: Nantucket Industries manufactures and sells two models of watches,Prime and Luxuria.It expects to sell 3,200 units of Prime and 1,300 units of Luxuria in 2019.The following estimates are given for 2019: Nantucket had an inventory of 230 units of Prime and 85 units of Luxuria at the end of 2018.It has decided that as a measure to counter stock outages it will maintain ending inventory of 370 units of Prime and 200 units of Luxuria. Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $11.There were 140 units of Crimpson in stock at the end of 2018.The management does not want to have any stock of Crimpson at the end of 2019. How many units of Prime watches must be produced in 2019? A) 3,570 units B) 3,340 units C) 3,200 units D) 2,970 units Nantucket had an inventory of 230 units of Prime and 85 units of Luxuria at the end of 2018.It has decided that as a measure to counter stock outages it will maintain ending inventory of 370 units of Prime and 200 units of Luxuria. Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $11.There were 140 units of Crimpson in stock at the end of 2018.The management does not want to have any stock of Crimpson at the end of 2019. How many units of Prime watches must be produced in 2019?


A) 3,570 units
B) 3,340 units
C) 3,200 units
D) 2,970 units

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The major objectives of a budgeting process should include all of the following EXCEPT:


A) providing coordination among the subunits
B) providing communication among the subunits
C) providing unyielding commitment to targets as a means to achieve a target profit
D) providing a framework for judging performance and facilitating learning

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Kaizen refers to incorporating cost reductions ________.


A) in each successive budgeting period
B) in each successive sales forecast
C) in all customer service centers
D) in all areas of the organization

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Which of the following is true of master budgets?


A) They include only financial aspects of a plan and exclude nonfinancial aspects.
B) Includes both financial and nonfinancial aspects of management's plans.
C) They aid in quantifying the expectations of all stakeholders.
D) They must be administered rigidly after they are committed to.

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In which order are the following developed? First to last: In which order are the following developed? First to last: A) ABDC B) DABC C) DCAB D) CABD


A) ABDC
B) DABC
C) DCAB
D) CABD

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Which of the following is the basic formula of the direct materials usage budget?


A) Ending inventory of direct materials + direct materials purchased and used during the period = direct materials to be used this period
B) Beginning inventory of direct materials + direct materials purchased and used during the period = direct materials to be used this period
C) units used in production + target ending inventory - beginning inventory = purchases to be made for the budget period
D) units used in production + target beginning inventory - ending inventory = purchases to be made for the budget period

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The district director of 5 mortgage origination offices staffed by bank associates who cold call potential customers in an attempt to gain home mortgage and home equity loan business is most likely responsible for a(n) ________.


A) revenue center
B) investment center
C) cost center
D) profit center

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Activity-based budgeting ________.


A) uses one cost driver such as direct labor-hours
B) uses only output-based cost drivers such as units sold
C) focuses on activities necessary to produce and sell products and services
D) classifies costs by functional area within the value chain

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Which of the following statements is true about activity-based budgeting?


A) activity-based budgeting estimates total costs more accurately than cost-based budgeting
B) activity-based budgeting provides more detailed information than cost-based budgeting
C) activity-based budgeting is cheaper than cost-based budgeting
D) activity-based budgeting is simpler to implement than cost-based budgeting

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The following information pertains to Monroe Company: The following information pertains to Monroe Company: How much cash will be collected from customers in March? A) $96,400 B) $91,600 C) $100,000 D) $118,000 The following information pertains to Monroe Company: How much cash will be collected from customers in March? A) $96,400 B) $91,600 C) $100,000 D) $118,000 How much cash will be collected from customers in March?


A) $96,400
B) $91,600
C) $100,000
D) $118,000

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Budgeted financial statements are called pro forma statements.

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The following information pertains to Amigo Corporation: The following information pertains to Amigo Corporation: Required: a.Prepare a summary of cash collections for the 4th quarter. b.Prepare a summary of cash disbursements for the 4th quarter. The following information pertains to Amigo Corporation: Required: a.Prepare a summary of cash collections for the 4th quarter. b.Prepare a summary of cash disbursements for the 4th quarter. Required: a.Prepare a summary of cash collections for the 4th quarter. b.Prepare a summary of cash disbursements for the 4th quarter.

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a.Cash collections Oct $36,448...

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Sensitivity analysis helps managers evaluate risks ________.


A) by showing the effects of changes to the original data or an underlying assumption
B) by identifying inconsistencies in underlying assumptions and actual conditions
C) by removing the effects of foreign currency exposure and other uncontrollable factors
D) by identifying gaps in the production process using information on setups needed to manufacture products

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Advanced Enterprises reports year-end information from 2018 as follows: Advanced Enterprises reports year-end information from 2018 as follows: Advanced is developing the 2019 budget.In 2019 the company would like to increase selling prices by 13.5%,and as a result expects a decrease in sales volume of 9%.All other operating expenses are expected to remain constant.Assume that cost of goods sold is a variable cost and that operating expenses are a fixed cost. What is budgeted sales for 2019? A) $1,090,735 B) $961,000 C) $992,569 D) $874,510 Advanced is developing the 2019 budget.In 2019 the company would like to increase selling prices by 13.5%,and as a result expects a decrease in sales volume of 9%.All other operating expenses are expected to remain constant.Assume that cost of goods sold is a variable cost and that operating expenses are a fixed cost. What is budgeted sales for 2019?


A) $1,090,735
B) $961,000
C) $992,569
D) $874,510

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Which of the following is a financial budget?


A) budgeted balance sheet
B) cash receivables budget
C) production budget
D) cost of goods sold budget

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To reduce budgetary slack management may ________.


A) incorporate stretch or challenge targets
B) use external benchmark performance measures
C) award bonuses for achieving budgeted amounts
D) reduce projected cost targets by 10% across all areas

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