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Preparing a Direct Materials Budget

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question 1 of 3

What is a direct materials budget?

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1. Do most companies know their exact direct materials cost?

2. What other budget is directly impacted by the direct materials budget?

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About This Quiz & Worksheet

The questions on this quiz provide a self-assessment for your use. It will tell you how much you know about the terms and concepts for creating a direct materials budget.

Quiz & Worksheet Goals

The quiz will ask you about:

  • The definition of a direct materials budget
  • How much a typical company knows about their own materials costs
  • The impact a materials budget has on other company budgets
  • Relationships to the procurement department
  • Budget line items

Skills Practiced

You will test such skills as:

  • Interpreting information - verify that you can review budget information and interpret it correctly
  • Information recall - access the knowledge you've gained regarding various budget types
  • Knowledge application - use your budgeting knowledge to identify priorities and make recommendations

Additional Learning

You can get more in-depth information by reviewing the lesson titled Preparing a Direct Materials Budget. This lesson lets you:

  • See how to accurately predict and plan for manufacturing needs
  • Get familiar with use of materials budgeting across the company
  • Discover which department most acutely feels the accuracy of budgets
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