# Sales budget

I'm having a bit of trouble understanding these questions, please help.

1. Which of the following is not a method that can reasonably be used to forecast sales?

1. trends in the company's sales data

2. mathematical models adjusted by an experienced manager using professional judgment

3. flexible budgets for various levels of production

4. estimates from the company's salespersons

2. The sales budget is based on assumptions about the:

1. costs of the units produced and the total fixed costs.

2. number of units to be sold and selling price per unit.

3. timing of cash receipts.

4. contribution margin per unit and the number of units to be sold.

3. The total variance for manufacturing overhead is:

1. only calculated if it is exceptional.

2. the difference between fixed overhead and variable overhead.

3. less than the labor efficiency variance.

4. the difference between the overhead applied to inventory at standard and the actual overhead costs.

4. If the controllable overhead variance is favorable, the overhead volume variance:

1. will be favorable.

2. will be zero.

3. will not be significant and may be omitted from the analysis.

4. may be favorable or unfavorable.

5. If the number of units in beginning inventory is more than the number of units in ending inventory, the number of units sold is:

1. greater than the number of units in ending inventory.

2. greater than the number of units produced.

3. less than the number of units produced.

4. less than the number of units in beginning inventory.

6. When might a favorable variance really be an unfavorable outcome?

1. When a manager overproduces to fully utilize labor in a non-bottleneck department.

2. When a manager refuses to buy a better material because it is more expensive.

3. Neither A nor B

4. Both A and B

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#### Solution Preview

1. Which of the following is not a method that can reasonably be used to forecast sales?:

3. flexible budgets for various levels of production=Answer

(As this is related to production, rather than sales)

2. The sales budget is based on assumptions about the: 2. number of units to be sold and selling ...

#### Solution Summary

Response discusses the sales budget