Answer the following statements true (T) or false (F)
1. For a manufacturer, the budgeted multi-step income statement shows operating income and net
income.
2. Amounts needed for the preparation of the budgeted balance sheet for a manufacturer are taken from
various operating and financial budgets.
3. When a manufacturing company prepares the budgeted balance sheet, the balance of the Accounts
Payable account is taken from the cash budget.
4. The cash budget of a manufacturer is comprised of three sections: cash receipts, cash payments and
long-term financing.
5. Unlike a manufacturing company, the sales budget is the cornerstone for the master budget of a
merchandising company.
1. TRUE
2. TRUE
3. FALSE
When preparing the budgeted balance sheet, the balance of the Accounts Payable account
is taken from the schedule of cash payments.
4. FALSE
5. FALSE
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Viper Avionics makes aircraft instrumentation. Its basic navigation radio requires $80 in variable costs and $2000 per month in fixed costs. Further processing the radio, to enhance its functionality, will require an additional $25 per unit of variable costs, plus an increase in fixed costs of $800 per month. The marketing manager believes that they would be able to increase the sales price of the radio from $260 to $300. Viper sells 30 radios per month. If Viper decides to further process the radio, monthly operating income would ________.
A) increase by $1200 B) increase by $3950 C) decrease by $350 D) decrease by $3950
A recent study found that about 70 percent of Americans consult either a user review site or an independent review site before ________.
A. making a purchase B. posting product information on social media C. using a product D. believing advertising E. beginning the shopping process
With a ________ strategy, managers aim to make their organization the most distinguished company serving just one or a few segments of the overall market.
A. hypercompetition B. differentiation C. focused low-cost D. low-cost E. focused differentiation
Which of the following is a procedure in which an organization compares its own practices against those of the competition?
A. Forecasting B. Delayering C. Benchmarking D. Offshoring E. Job evaluation