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Cost Accounting 101 Practice Test: Master Budget and Responsibility Accounting
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A master budget is a collection of lower-level budgets that outlines a company's objectives. Responsibility accounting is a budgeting process that involves analyzing and cutting costs.  Here's some more information about master budgets and responsibility accounting: Master budget: A master budget is a strategic plan that combines a company's smaller budgets into one larger budget. It's usually developed by a firm's budget committee and includes a sales budget, production schedule, and direct materials, labor, and overhead budget. A master budget can help management identify goals, motivate... Show more
Cost Accounting 101 Practice Test: Master Budget and Responsibility Accounting
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25 Questions

1. The use of activity-based budgeting is growing because of:
2. Budgeting provides all of the following EXCEPT:
3. Activity-based budgeting does NOT require:
4. Research shows that challenging budgets improve employee performance because employees view falling short of budgeted numbers as a failure.
5. Since fixed manufacturing overhead is fixed, it is NOT normally included in the operating budget.
6. The revenues budget should be based on the production budget.
7. If budgeted amounts change, sensitivity analysis can be used to examine changes in the budgeted results.
8. Building in budgetary slack includes:
9. The manager of a hobby store that is part of a chain of stores is most likely responsible for a(n):
10. The operating budget process generally concludes with the preparation of the:
11. Human factors are crucial parts of budgeting.
12. Budgeting for a multinational company is made more complex due to the possibility of exchange rate fluctuations.
13. Even in the face of changing conditions, attaining the original budget is critical.
14. Participation of employees in the budgeting process helps to create:
15. Operating budgets include the:
16. A responsibility center is a part, segment, or subunit of an organization, whose manager is accountable for a specified set of activities.
17. A master budget:
18. The sales forecast is influenced by:
19. When administered wisely, budgets promote communication and coordination among the various subunits of the organization.
20. The number of units in the sales budget and the production budget may differ because of a change in:
21. The Japanese use the term kaizen when referring to:
22. Lower-level managers will not actively participate in the budget process if they perceive upper management does NOT believe in the process.
23. Budgeted manufacturing overhead costs include all types of factory expenses EXCEPT:
24. A manager of a revenue center is responsible for all of the following EXCEPT:
25. A responsibility accounting system could:

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