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What is a Cash Budget?

1. What is a cash budget?

a. Detailed plan of future cash flows

b. A budget that shows only what cash comes in

c. A historical look at cash flows

d. A report that analyzes the cash account

e. A report that analyzes the accounts receivable

2. What is the key ingredient of the organization's planning process?

a. Past performance

b. Union contracts

c. Capital budget

d. Full time equivalent employees

e. Sales forecast

3. If an organization collects 30% of sales within a month and the balance two months after the sale, how much would it collect in March if it sold 60,000 in January and 80,000 in February?

a. 20,000

b. 64,000

c. 140,000

d. 66,000

e. 52,000

4. If your revenue is $10 million, your variable cost is $6 million, your fixed cost is $3 million, what is your contribution margin?

a. $4 million

b. $1 million

c. $3 million

d. $9 million

e. $7 million

5. What is present value?

a. The money you have now

b. The money you have before paying taxes

c. The money you will get next month

d. The current value of a future sum

e. The future value of a current sum

6. How much will you have at the end of three years if you put away $2500 at the end of each year, and you earn 4% on your money?

a. $7500

b. $8000

c. $7805

d. $7800

e. $7750

7. Which of the following decreases the breakeven point?

a. Increase fixed costs

b. Increase variable costs

c. Lower sales price

d. Increase units sold

e. Decrease fixed costs

Solution Preview

1. What is a cash budget?

a. Detailed plan of future cash flows

b. A budget that shows only what cash comes in

c. A historical look at cash flows

d. A report that analyzes the cash account

e. A report that analyzes the accounts receivable

Answer: A

2. What is the key ingredient of the organization's planning process?

a. Past performance

b. Union contracts

c. Capital budget

d. ...

Solution Summary

This solution is comprised of a detailed explanation to answer what is a cash budget.

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