5. Which of the following is not a benefit of following a well-designed budgetin

Question

5. Which of the following is not a benefit of following a well-designed budgeting process? . Improved decision-making processes. . Improved performance evaluations. . Improved coordination of business activities. . Assurance of future profits. . Improved commitment to meet expected performance by those affected. 16. When preparing the cash budgce,all the following should be considered except: A. Cash receipts from customers hen preparing the cash budget, all the following should be considered except B. Cash payments for merchandise. Depreciation expense. D. Cash payments for income taxes. C. E. Cash payments for capital expenditures. 17. The sales level at which a company neither earns a profit nor incurs a loss is the: A. Relevant range. B. Margin of safety. C. Step-wise variable level. D. Break-even point. E. Contribution margin. 18. A product sells for $30 per unit and has variable costs of $18 per unit. The fixed costs are S720,000. If the variable costs per unit were to decrease to $15 per unit and fixed costs increase to $900,000, and the selling price does not change, break-even point in units would: A. Increase by 20,000. B. Equal 6,000. C. Increase by 6,000. D. Decrease by 20,000. E. Not change.

Explanation / Answer

ANS;

15) Assurance of future profits

16) Depreciation expense

17) the break even point

18)  Starting break-even point is 60,000 units.
($720,000 / $12 unit contribution margin)

Hypothetical break-even point is also 60,000 units.
($900,000 / $15 unit contribution margin)

20)

74,000-62,000)/(42,300-30,000)= 0.976

74,000-42,300*.976= 32,715 D)

21) $7.00

22) A budget committee

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