BAO 1101 Study Guide - Quiz Guide: Retained Earnings, Sole Proprietorship, Income Statement

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limefrog702

29 Jun 2018

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Ques"on Set

Ques"on 1 1 / 1 point

The budget process usually focuses on the "me frame of one:

day

week

month

year

Ques"on 2 1 / 1 point

What is a budget:

ﬁnancial details of past performance

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a ﬁnancial es"mate of future business performance

ﬁnancial details of actual performance

ﬁnancial details of compe"tor's performance

Ques"on 3 1 / 1 point

Strategic planning relates to planning for:

the short term (usually less than 1 year).

the short term (usually 1 to 3 months).

the longer term (o#en 3 to 5 years).

none of the op"ons listed

Ques"on 4 0 / 1 point

Which of the following would not be included in a cash budget

deprecia"on

dividends

payment of wages

receipt of sales

Ques"on 5 1 / 1 point

Simon’s "three wheels of planning" show how the following three areas

connect:

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Document Summary

The budget process usually focuses on the "me frame of one: day week month year. Nancial details of past performance a nancial es"mate of future business performance. Strategic planning relates to planning for: the short term (usually less than 1 year). the short term (usually 1 to 3 months). the longer term (o#en 3 to 5 years). none of the op"ons listed. Which of the following would not be included in a cash budget deprecia"on dividends payment of wages receipt of sales. Simon"s "three wheels of planning" show how the following three areas connect: cash, sales and pro ts cash, pro t and return on equity pro t, cash and income return on equity, cash and assets. Consider the following details for eastco jeans store:- inventory at. During the year, ,000 of clothes were purchased. It is expected to have a useful life of 3 years and a trade-in value of ,000. Tanya purchased inventory during the year cos"ng ,000.

Related Questions

How do strategic planning, long-range planning, and budgeting differ?

A. Strategic planning focuses on the effects that the operating budget and other plans (capital budget) will have no cash balances. Long-range planning usually has a horizon of one year or less, and focuses on the budgeted cost of activities required to produce and sell products and services. Budgeting does not usually cover a specific time period, is quite general, and often is not built around financial statements.

b. Strategic planning covers no specific time period, is quite general, and often is not built around financial statements. Long-range planning usually has a 5 or 10-year horizon and consists of financial statements without much detail. Budgeting usually has a horizon of one year or less and consists of financial statements with much detail.

c. Strategic planning usually has a 5 or 10-year horizon and consists of financial statements without much detail. Long-range planning usually has a horizon of one year or less, consists of financial statements with ch detail. Budgeting usually covers no specific time period, is quite general, and is not built around financial statements.

d. Strategic planning is an ongoing process that adds a month or a quarter as the month or quarter ended is dropped. Long-range planning usually has a horizon of one year or less, consists of financial statements with much detail. Budgeting focuses on preparing budgets for various functions over a specific time period.

purpledinosaur241

1â28. Multiple Choice Questions
Select the best answer for each of the following items and give reasons for your choice.
a. Which of the following best describes the relationship between assurance services and
attest services?
(1) While attest services involve fi nancial data, assurance services involve nonfi nancial data.
(2) While attest services require objectivity, assurance services do not require objectivity.
(3) Both attest and assurance services require independence.
(4) Attest and assurance services are different terms referring to the same types of services.
b. Which of the following has primary responsibility for the fairness of the representations
made in fi nancial statements?
(1) Clientâs management.
(2) Independent auditor.
(3) Audit committee.
(4) AICPA.
c. The most important benefi t of having an annual audit by a public accounting fi rm is to:
(1) Provide assurance to investors and other outsiders that the fi nancial statements are reliable.
(2) Enable offi cers and directors to avoid personal responsibility for any misstatements in
the fi nancial statements.
(3) Meet the requirements of government agencies.
(4) Provide assurance that illegal acts, if any exist, will be brought to light.
d. The Sarbanes-Oxley Act created the Public Company Accounting Oversight Board
(PCAOB). Which of the following is not one of the responsibilities of that board?
(1) Establish independence standards for auditors of public companies.
(2) Review fi nancial reports fi led with the SEC.
(3) Establish auditing standards for audits of public companies.
(4) Sanction registered audit fi rms.
e. Which of these organizations has the responsibility to perform inspections of auditors of
public companies?
(1) American Institute of Certifi ed Public Accountants.
(2) Securities and Exchange Commission.
(3) Financial Accounting Standards Board.
(4) Public Company Accounting Oversight Board.
f. Governmental auditing, in addition to including audits of fi nancial statements, often
includes audits of effi ciency, effectiveness, and:
(1) Adequacy.
(2) Evaluation.
(3) Accuracy.
(4) Compliance.
g. In general, internal auditorsâ independence will be greatest when they report directly to the:
(1) Financial vice president.
(2) Corporate controller.
(3) Audit committee of the board of directors.
(4) Chief executive offi cer.
h. Which of the following did not precipitate the passage of the Sarbanes-Oxley Act of 2002
to regulate public accounting fi rms:
(1) Disclosures related to accounting irregularities at Enron and WorldCom.
(2) Restatements of fi nancial statements by a number of public companies.

(3) Conviction of the accounting fi rm of Arthur Andersen LLP.
(4) Ethical scandals at the AICPA.
i. Which of the following organizations establishes accounting standards for U.S. government
agencies?
(1) The Financial Accounting Standards Board.
(2) The Governmental Accounting Standards Board.
(3) The Federal Accounting Standards Advisory Board.
(4) The Public Company Accounting Oversight Board.
j. Which of the following is correct about forensic audits?
(1) All audit engagements are forensic in nature.
(2) Forensic audits are performed by law fi rms; they are not performed by CPA fi rms.
(3) Forensic audits are equivalent to compliance audits.
(4) Forensic audits are usually performed in situations in which fraud has been found or is
suspected.
k. What best describes the purpose of the auditorsâ consideration of internal control in a
fi nancial statement audit for a nonpublic company?
(1) To determine the nature, timing, and extent of audit testing.
(2) To make recommendations to the client regarding improvements in internal control.
(3) To train new auditors on accounting and control systems.
(4) To identify opportunities for fraud within the clientâs operations.
l. Which of the following is an example of a compliance audit?
(1) An audit of fi nancial statements.
(2) An audit of a companyâs policies and procedures for adhering to environmental laws
and regulations.
(3) An audit of a companyâs internal control over fi nancial reporting.
(4) An audit of the effi ciency and effectiveness of a companyâs legal department.

coralbadger702

Briefly discuss the ways a realistic budget will benefit the owner of Babycakes versus having no budget at all. Be sure to use Babycakes as the company and any specific product details in your explanation.

Prepare a sales budget for the LA Babycakes store for the 4th quarter of 2016. Present the number of units, sales price, and total sales for each month; include October, November, and December, and a total for the quarter. Use one-half of the Valentineâs Day sales as the basis for a usual day in the new quarter. Use 30 days for each month. Calculate the total sales for each month for October, November, and December.

Create three (3) new products, one (1) for each of the three (3) holiday seasons in the 4th quarter. Estimate the sales units, sales price, and total sales for each month. Describe the assumptions used to make these estimates. Include an overview of the budget in the report, presenting the actual budget as an appendix with all data and calculations. Add these amounts to your sales budget.

The owner of Babycakes is interested in preparing a flexible budget rather than the static budget she currently uses. She does not understand why, when sales increase, her static budget often shows an unfavorable variance. Explain how a flexible budget will overcome this problem. Use the details of your newly prepared budget for the 4th quarter of 2016 to address her concern.

Imagine that Babycakes is facing a financial challenge that is causing the actual amount of money that it spends to become significantly more than its budgeted amount. Include a discussion of your own unique cause of the overspending. Explain the corrective actions needed to address these challenges.

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