Principles of Financial and Managerial Accounting - D196 WGU Exam Study Guide with Verified Solutions

Principles of Financial and Managerial Accounting - D196 WGU Exam Study Guide with Verified Solutions the production budget - Correct Answer Sales budget + ending finished goods inventory - beginning finished goods inventory direct materials production budget - Correct Answer Production budget × direct materials per unit the direct materials purchases budget - Correct Answer Direct materials production budget + ending direct materials inventory - beginning direct materials inventory Cash collected from customers - Correct Answer (current period revenue × current period collection rate) + cash collected from previous period sales Cash payments to suppliers - Correct Answer (current period purchases × current period payment rate) + cash paid on previous period purchases Cost Variance - Correct Answer Difference between actual costs and budgeted costs Contribution Margin - Correct Answer = Sales Revenue - Variable Costs The difference between total sales and variable costs; the portion of sales revenue available to cover fixed costs and provide a profit. Target Income - Correct Answer = Sales Revenue - Variable Costs - Fixed Costs A profit level desired by management. At break-even - Correct Answer Target income = 0