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. Multiple Choice. Encircle the correct letter 1. The budget committee in a company is often headed by the a. president. b. controller c. treasurer d. budget director 2 There are various budgets within the master budget. One of these budgets is the production budget. Which of the following BEST describes the production budget? A. It details the required direct labor hours. B It details the required raw materials purchases. C. It is calculated based on the sales budget and the desired ending inventory D. It summarizes the costs of producing units for the budget period. 3. The financial budgets include the a. cash budget and the selling and administrative expense budget. b. cash budget and the budgeted balance sheet. C budgeted balance sheet and the budgeted income statement. d cash budget and the production budget. 4. The culmination of preparing operating budgets is the a. budgeted balance sheet. c. cash budget. b production budget. d. budgeted income statement 5. Long-range planning usually encompasses a period of at least a. six months. b. 1 year. C. 5 years. d. 10 years 6. The cash budget must be prepared before you can complete the A. production budget. C. raw materials purchases budget B. budgeted balance sheet. D. schedule of cash disbursements. 7. The concept of responsibility accounting means that: A Budgetary data should be reviewed and approved by the budget committee. B. Budgetary data should be reviewed and approved by all levels of management. C. An employee's performance should be evaluated only on those items under his or her control. D. An employee's performance should be evaluated only by his or her immediate supervisor 8. A flexible budget recognizes a . fixed costs change in relation to activity b . variable costs change in relation to activity C . both fixed and variable costs can change in relation to activity, but fixed costs usually do not change neither fixed nor variable costs change in relation to activity 9. The excess or deficiency of cash available over disbursements on the cash budget is calculated as follows A. The beginning balance less the expected cash receipts less the expected cash disbursements. B. The cash available less the expected cash receipts plus the expected cash disbursements. C The beginning balance plus the expected cash receipts less the expected cash disbursements. D. None of these