Grayson Enterprises manufactures springs and shock absorbers. Springs account for 40% of the company's total sales revenue, whereas shocks account for about 60%. The contribution margin ratios for springs and shocks are 45% and 35%, respectively. Grayson's fixed costs average $450,000 per month. Grayson's monthly break-even point expressed in sales dollars is: ( )
A. $1,000,000.
B. $1,285,714.
C. $1,153,846.
D. $2,285,714
A budget that can be adjusted easily to show budgeted revenues, costs, and cash flows at different levels of activity is known as( )
A flexible budget.
B. A master budget.
C. A production budget.
D. A multi-level budget.
When budgeted amounts are set at reasonable and achievable levels: ( )
A. They reflect a "total quality management" philosophy of management.
B. A highly efficient department should fall slightly short of budget standards.
C. Meeting the budgeted amounts ensures a maximum level of profitability.
D. Failure to stay within the budget is viewed as an unacceptable level of performance.