5. Finance

Budgeting — Quiz

Test your understanding of budgeting with 5 practice questions.

Practice Questions

Question 1

A company has a budgeted sales revenue of $$ \$750,000 $. The budgeted variable costs are $ 55\% $ of sales, and fixed costs are $ \$200,000 $$. What is the budgeted net profit?

Question 2

Which budgeting method requires managers to justify all expenses for each new period, starting from a base of zero, rather than incrementally adjusting previous budgets?

Question 3

A company's production budget for the next quarter is $ 1,500 $ units. Each unit requires $ 2.5 $ kg of raw material at a cost of $$ \$4 $$ per kg. What is the total budgeted cost for raw materials?

Question 4

When conducting variance analysis, an unfavorable direct labor efficiency variance would most likely indicate:

Question 5

A company is preparing its cash budget for the next quarter. Beginning cash balance is $$ \$20,000 $. Expected cash receipts from sales are $ \$150,000 $, and expected cash disbursements for expenses are $ \$130,000 $$. What is the ending cash balance for the quarter?