BUS5111 Applied Managerial Accounting Unit 3 Graded Quiz — 25
Q&A Verified Answers 2025
Course:
BUS5111 Applied Managerial Accounting — University of the People (UoPeople)
Level:
MBA
Year:
2025/2026
Format:
Graded Quiz Solutions — 25 Q&A with Verified Answers
BUS5111 Unit 3 Graded Quiz — Budgeting and Planning
25 Questions with Verified Answers | Score: 96/100
Question 1:
Which of the following best describes the primary sequence of preparation for the components of
a master budget in a manufacturing organization?
A) Production budget, sales budget, cash budget, budgeted income statement
B) Sales budget, production budget, budgeted income statement, cash budget
C) Cash budget, sales budget, production budget, budgeted balance sheet
D) Budgeted income statement, sales budget, production budget, cash budget
Answer: B
Explanation:
The master budget must always begin with the sales budget, as expected sales volume dictates
necessary production levels. Once the production budget and subsequent operating budgets
(materials, labor, overhead) are completed, the budgeted income statement is prepared, which
then feeds the necessary net income and expense data into financial budgets like the cash
budget.
Question 2:
, A company expects to sell 10,000 units next month. They want to maintain an ending inventory
equal to 20% of the following month's expected sales of 12,000 units. If the beginning inventory is
1,500 units, how many units must be produced next month?
A) 10,000 units
B) 12,400 units
C) 10,900 units
D) 13,900 units
Answer: C
Explanation:
The production budget is calculated using the formula: Expected Sales + Desired Ending Inventory
- Beginning Inventory. Here, it is 10,000 + (0.20 * 12,000) - 1,500 = 10,000 + 2,400 - 1,500 =
10,900 units. This ensures the company meets sales demand while maintaining adequate safety
stock for the following period.
Question 3:
Which of the following is the defining characteristic of zero-based budgeting (ZBB) compared to
traditional incremental budgeting?
A) Managers must justify all budgeted expenditures from scratch, regardless of previous spending
levels.
B) Budgets are prepared only for the exact amount of cash currently available in the zero-balance
operating account.
C) It automatically adjusts expected costs based on actual zero-point production volumes
achieved during the quarter.
D) It relies heavily on last year's actual results plus a standard percentage increase for expected
inflation.
Answer: A
Explanation:
Zero-based budgeting requires that every line item in the budget be approved and justified as if it
were a brand new expense, starting from a "zero base." This contrasts with incremental
budgeting, which simply takes the previous year's budget and adjusts it up or down, a practice
that often perpetuates historical inefficiencies.
Question 4:
Q&A Verified Answers 2025
Course:
BUS5111 Applied Managerial Accounting — University of the People (UoPeople)
Level:
MBA
Year:
2025/2026
Format:
Graded Quiz Solutions — 25 Q&A with Verified Answers
BUS5111 Unit 3 Graded Quiz — Budgeting and Planning
25 Questions with Verified Answers | Score: 96/100
Question 1:
Which of the following best describes the primary sequence of preparation for the components of
a master budget in a manufacturing organization?
A) Production budget, sales budget, cash budget, budgeted income statement
B) Sales budget, production budget, budgeted income statement, cash budget
C) Cash budget, sales budget, production budget, budgeted balance sheet
D) Budgeted income statement, sales budget, production budget, cash budget
Answer: B
Explanation:
The master budget must always begin with the sales budget, as expected sales volume dictates
necessary production levels. Once the production budget and subsequent operating budgets
(materials, labor, overhead) are completed, the budgeted income statement is prepared, which
then feeds the necessary net income and expense data into financial budgets like the cash
budget.
Question 2:
, A company expects to sell 10,000 units next month. They want to maintain an ending inventory
equal to 20% of the following month's expected sales of 12,000 units. If the beginning inventory is
1,500 units, how many units must be produced next month?
A) 10,000 units
B) 12,400 units
C) 10,900 units
D) 13,900 units
Answer: C
Explanation:
The production budget is calculated using the formula: Expected Sales + Desired Ending Inventory
- Beginning Inventory. Here, it is 10,000 + (0.20 * 12,000) - 1,500 = 10,000 + 2,400 - 1,500 =
10,900 units. This ensures the company meets sales demand while maintaining adequate safety
stock for the following period.
Question 3:
Which of the following is the defining characteristic of zero-based budgeting (ZBB) compared to
traditional incremental budgeting?
A) Managers must justify all budgeted expenditures from scratch, regardless of previous spending
levels.
B) Budgets are prepared only for the exact amount of cash currently available in the zero-balance
operating account.
C) It automatically adjusts expected costs based on actual zero-point production volumes
achieved during the quarter.
D) It relies heavily on last year's actual results plus a standard percentage increase for expected
inflation.
Answer: A
Explanation:
Zero-based budgeting requires that every line item in the budget be approved and justified as if it
were a brand new expense, starting from a "zero base." This contrasts with incremental
budgeting, which simply takes the previous year's budget and adjusts it up or down, a practice
that often perpetuates historical inefficiencies.
Question 4:
