UNIT VI LAB ASSIGNMENT
Capital Budgeting and Budgetary Planning and Control
1. Capital expenditure decisions
Are useful estimating inventory acquisition costs.
Always involve the acquisition of long-lived assets.
Consist of a final of approved projects.
All of these answer choices are correct,
2. Which of the following is not a component of a time value of money calculation?
The amount of cash to be received.
The time until the cash will be received.
The opportunity costs of the alternative actions.
The required rate of return.
3. Which of the following is correct concerning a budget?
It is a formal document that quantifies a company’s plans for achieving its goals.
It is prepared by the budget committee.
All of the answer choices are correct.
4. A budget is useful in the planning process because it
Determines who is to blame for poor operations.
Forces managers to think about goals and objectives and means of achieving them.
Identifies budget padding.
Creates budget slack.
5. Which of the following transactions will affect the cash budget for a particular month in which each transaction occurs?
Sale of a product when payment will be received in 60 days
Payment for direct labor
Amortization of prepaid insurance
Depreciation of a piece of equipment that was purchased last year.
