Budgeting and Forecasting 278 Midterm 2014
Budgeting and Forecasting 278 Midterm 2014
(TCO 1) The type of budget that is updated on a regular basis is known as a _____.
Student Answer:
continuous budget
revised budget
updated budget
flexible budget
TCO 2) The quantitative forecasting method that uses actual sales from recent time periods to predict future sales, assuming each period has equal influence on the prediction of future sales, is the _____.
Student Answer:
moving average model
weighted moving average model
exponential smoothing model
equal average model
(TCO 3) Before performing linear regression, it is important to ensure that a linear relationship exists between the dependent and independent variables by plotting observed data on a diagram called the _____.
Student Answer:
linear graph
scattergram
scattergraph
regression graph
(TCO 4) Marketing costs include _____.
Student Answer:
advertising
packaging
travel and entertainment
All of the above
(TCO 5) Priority budgeting that ranks activities is known as _____.
Student Answer:
top-down budgeting
bottom-up budgeting
zero-base budgeting
participative budgeting
(TCO 6) Which of the following is a disadvantage of the payback technique?
Student Answer:
It is difficult to calculate.
It relies on the time value of money.
It can only be calculated when there are equal annual net cash flows.
It ignores the expected profitability of a project.
(TCO 1) Budgeting is a planning and control system. Discuss how budgeting contributes to these two functions of management.
A budgeting process based on sound concepts of planning and control can help a company create value. Budgeting serves as a planning and controlling system by documenting the goals and performance objectives in financial terms, then using those plans throughout the year. Monthly performance reports compare budgeted results, with actual results. To control
(TCO 1) The type of budget that is updated on a regular basis is known as a _____.
Student Answer:
continuous budget
revised budget
updated budget
flexible budget
TCO 2) The quantitative forecasting method that uses actual sales from recent time periods to predict future sales, assuming each period has equal influence on the prediction of future sales, is the _____.
Student Answer:
moving average model
weighted moving average model
exponential smoothing model
equal average model
(TCO 3) Before performing linear regression, it is important to ensure that a linear relationship exists between the dependent and independent variables by plotting observed data on a diagram called the _____.
Student Answer:
linear graph
scattergram
scattergraph
regression graph
(TCO 4) Marketing costs include _____.
Student Answer:
advertising
packaging
travel and entertainment
All of the above
(TCO 5) Priority budgeting that ranks activities is known as _____.
Student Answer:
top-down budgeting
bottom-up budgeting
zero-base budgeting
participative budgeting
(TCO 6) Which of the following is a disadvantage of the payback technique?
Student Answer:
It is difficult to calculate.
It relies on the time value of money.
It can only be calculated when there are equal annual net cash flows.
It ignores the expected profitability of a project.
(TCO 1) Budgeting is a planning and control system. Discuss how budgeting contributes to these two functions of management.
A budgeting process based on sound concepts of planning and control can help a company create value. Budgeting serves as a planning and controlling system by documenting the goals and performance objectives in financial terms, then using those plans throughout the year. Monthly performance reports compare budgeted results, with actual results. To control