Acme Profit Speedway is a subsidiary Investment Progressive Group Cost Burpee Profit Indicate whether the scenario is decentralized or centralized Centralized Rondell Company Plastic Lumber Company Two Turtle Decentralized Specialty Motors Wasick Krampf Shroath Identify which type of responsibility center each item is Investment Trek Hershey H R block Cost Human Resource Accounting Research Taxation Reveune Reservation Office Southwestern Profit Disney Sherwin Roseville Headquarters for international consulting investment center Fixed expenses can be traced direct fixed expenses Sales margin income for every 1 KPI included on balanced scorecard Actual results minus the master budget master budget variance Goals the same goal congruence Local branch profit center Fixed expenses that cannot be traced common fixed expenses Flexible budget different volumes Difference between flexible budget and actual results flexible budget variance ROI measures profitability If budgeted salary is higher than actual salary expense favorable variance Revenue center responsible for generating revenue Volume variance sold different amount than planned Capital turnover shows sales revenue Budgeted sales are greater than actual unfavorable variance Management by exception investigate large variances Legal department of a manufacturer cost center Lag indicators reveal the results of past actions They come after decisions and actions taken in the past Lead indicators indicate future performance They come before and drive future performance Financial measures tend to be lag The financial results are driven by actions taken in the past Ford sales result from earlier decisions about design production planning pricing and whether to feature certain models in advertising Operational measures lead Current customers predict how well the company will do in the future Customer satisfaction can predict whether future sales will increase or decline Internal Business Perspective Downtime of orders filled number of new patents New product with online help Customer Perspective of orders filled Number of complaints satisfaction ratings Financial Perspective Gross margin growth ROI Learning and Growth Perspective Employee satisfaction number of information system upgrades employee turnover rate Chapter 9 Amazon com expects to receive which of the following benefits when it uses its budgeting process All of the above Budgets are future oriented Technology has made it easier for managers to perform all of the following tasks except removing slack from the budget Which of the following is the starting point for the master budget The sale budget The income statement is part of which element of a company s master budget The operating budgets The usual starting point for a direct labor budget for a manufacturer is the production budget The following budgets are all financial budgets except for the budgeted income statement Which of the following expenses would not appear in a cash budget Depreciation expense Which of the following budgets would ordinarily not be prepared by a service company For a merchandising company the Cost of Goods Sold Inventory and Purchases budget replaces all of the following budgets except the Sales budget Totz company produces jump ropes Q1 21k Q2 35 Q3 22k Q4 30k Inventory at the beginning 4200 20 of the net quart unit on hand How many ropes during the first quarter 23800 Which of the following was not a benefit of budgeting presented in class It s a rigid amount that you can t exceed Do capital expenditures have their own budget Yes Which of the following expenses would not appear in a cash budget Depreciation expense The income statement is part of which element of a company s master budget The operating budgets In the cash payments budget which of the following accounts gets backed out Depreciation FW Corp makes desks Plans to produce 1k in March 2k in April Each desk requires 25 direct labor hours 14 per direct labor hour Total combined direct labor costs for March and April 10500 Chapter 10 Which is not one of the potential advantages of decentralization Increase goal congruence The Quaker Foods division of PepsiCo is most likely treated as an investment center When management only investigates budget variances that are large this is an example of management by exception Which of the following is a disadvantage of financial performance measures such as ROI and residual income Focus on short term performance For which type of responsibility center would it be appropriate to measure performance using ROI Investment Center A flexible budget contains a plan for a range of activity so that the plan can be adjusted to reflect changes in activity levels The volume variance on a flexible budget report is the difference between the master budget and the flexible budget Average repair time on products returned for service would be a typical measure for which of the following balanced scorecard perspectives Internal business Which of the following balanced scorecard perspectives essentially asks the question Can we continue to improve and create value Learning and growth The flexible budget uses actual units volumes True Chapter 11 Which of the following would be least likely to cause a direct material quantity standard to be outdated Demand for the product has increased steadily over the past two years in spite of a worsening economy The direct materials price variance is calculated using the actual quantity of materials purchased All of the following could cause an unfavorable direct materials quantity variance except an increase in selling price The direct lab efficiency variance is calculated using the standard labor rate per hour Of the following choices which would be the most likely to be the cause of an unfavorable direct labor rate variance using highly paid skilled workers for routine jobs normally performed by minimum wage workers Advantages of using standard cost include all of the following except that the price sensitivity of customers can be analyzed The variable overhead spending variance is calculated using the following formula Actual hours x Actual Rate Standard Rate The fixed overhead variances are the budget variance and the volume variance The production volume variance is favorable whenever actual out put exceeds expected input Chapter 12 Examples of capital budgeting investments could include all of the following except paying bonuses to the sales force Suppose Amazon is