Question 1

What three sources do managers use to obtain budgeted input prices and budgeted input quantities?

Accepted Answer

To calculate price and efficie

Question 2

Keepsake Corporation currently produces picture frames in an automated process.Expected production per month is 39,000 units,direct-material costs are $0.47 per unit,and manufacturing overhead costs are $16,500 per month.Manufacturing overhead consists of fixed costs.
Required
Compute the flexible budget for 19,250 units.

Accepted Answer

A) $25,047.50 
B) $26,157.50 
C) $27,189.50 
D) $25,347.50 
E) $25,547.50 
A) $25,047.50 
B) $26,157.50 
C) $27,189.50 
D) $25,347.50 
E) $25,547.50

Question 3

Possible operational causes of a direct materials efficiency unfavorable variance include all of the following except:

Accepted Answer

A) poor work on the production line. 
B) efficient design of products or processes. 
C) congestion due to overscheduling of orders. 
D) inappropriate assignment of labor and machines to specific jobs. 
E) suppliers not manufacturing materials of uniformly high quality. 
A) poor work on the production line. 
B) efficient design of products or processes. 
C) congestion due to overscheduling of orders. 
D) inappropriate assignment of labor and machines to specific jobs. 
E) suppliers not manufacturing materials of uniformly high quality.

Question 4

________ is the difference between actual quantity of the cost-allocation base used and budgeted quantity of the cost-allocation base that should have been used to produce actual output,multiplied by budgeted variable overhead cost per unit of the cost-allocation base.

Accepted Answer

A) Contribution margin 
B) Budgeted sales price 
C) Budgeted level of output 
D) Fixed overhead efficiency variance 
E) Variable overhead efficiency variance 
A) Contribution margin 
B) Budgeted sales price 
C) Budgeted level of output 
D) Fixed overhead efficiency variance 
E) Variable overhead efficiency variance

Question 5

How does the planning of fixed overhead costs differ from the planning of variable overhead costs?

Accepted Answer

At the start of a budget period,manageme

Question 6

Management can get further insight in the reason of flexible-budget variance for direct-cost input variances when they subdivide them into ________ and spending variances.

Accepted Answer

A) defect rates 
B) post-sales affect flexible-budget variance for direct-cost input 
C) revenue variances 
D) efficiency variances 
E) gross margin percentage 
A) defect rates 
B) post-sales affect flexible-budget variance for direct-cost input 
C) revenue variances 
D) efficiency variances 
E) gross margin percentage

Question 7

Why is constructing and using a flexible budget beneficial to management?

Accepted Answer

The flexible budget allows management to

Question 8

A sales-volume variance is the difference between a flexible budget amount and what other data factor?

Accepted Answer

A) The total flexible budget variable costs. 
B) The corresponding static-budget amount. 
C) The flexible-budget fixed costs. 
D) The percentage of returns on sales. 
E) The price recovery rate. 
A) The total flexible budget variable costs. 
B) The corresponding static-budget amount. 
C) The flexible-budget fixed costs. 
D) The percentage of returns on sales. 
E) The price recovery rate.

Question 9

B&C Entertainment,film distribution center,has a static-budget operating income of $164,000 and an actual operating income of $48,000.
Required
Compute the static-budget variance for operating income and identify whether the variance is favorable,F,or unfavorable,U.

Accepted Answer

A) $116,000;U variance 
B) $116,000;F variance 
C) $212,000;U variance 
D) $212,000;F variance 
E) $787,200;F variance 
A) $116,000;U variance 
B) $116,000;F variance 
C) $212,000;U variance 
D) $212,000;F variance 
E) $787,200;F variance

Question 10

What could cause the two manufacturing efficiency variances,direct materials efficiency variance and the direct manufacturing labor efficiency variable,to show as unfavorable?

Accepted Answer

There is a decrease in operati

Question 11

The expected performance is also referred to as the ________.

Accepted Answer

A) variance 
B) target output 
C) critical value set 
D) financial objective 
E) budgeted performance 
A) variance 
B) target output 
C) critical value set 
D) financial objective 
E) budgeted performance

Question 12

Managers find it useful to subdivide the flexible-budget variance for direct cost variance into a ________ variance and an efficiency variance.

Accepted Answer

A) price 
B) input 
C) price recovery 
D) productivity 
E) sales-volume 
A) price 
B) input 
C) price recovery 
D) productivity 
E) sales-volume

Question 13

In March 2013,Busy Brains Text Company produced and sold 26,000 textbooks,each at a cost of $230.
Required
Compute the flexible-budget revenues for textbooks.

Accepted Answer

A) $3,690,430 
B) $5,980,000 
C) $38,380,000 
D) $27,945,000 
E) $53,650,000
Required 
A) $3,690,430 
B) $5,980,000 
C) $38,380,000 
D) $27,945,000 
E) $53,650,000
Required

Question 14

The managerial accountant at Diamond Manufacturing reported that the static-budget operating income of $110,000 for 12,000 diamond-stud jackets is $9.16 per jacket.The manager reported a shortfall of 1,800 jackets.
Required
Compute the operating-income volume variance.

Accepted Answer

A) $15,000 
B) $15,500 
C) $15,750 
D) $16,244 
E) $16,488 
A) $15,000 
B) $15,500 
C) $15,750 
D) $16,244 
E) $16,488

Question 15

Variable overhead has a production-volume variance.

Accepted Answer

A) True 
 B)False

Question 16

Isometric Foundation Materials Company is calculating the variable overhead spending variance due to a difference in the actual variable overhead cost per unit of their cost per unit allocation base and the budgeted variable overhead cost per unit.Operational management had budgeted for a $65 variable overhead cost per unit but now find that the actual cost per unit of the allocation base is $60 per unit.The actual quantity of machine hours used was 5,500.
Required
Compute the variable overhead spending for IFMC and indicate whether it is a favorable,F,or unfavorable,U,variance.

Accepted Answer

A) $27,500 U 
B) $17,500 U 
C) $27,500 F 
D) $7,500 F 
E) $17,500 F 
A) $27,500 U 
B) $17,500 U 
C) $27,500 F 
D) $7,500 F 
E) $17,500 F

Question 17

What are the benefits of variance analysis to a public official?

Accepted Answer

Variance analysis is important

Question 18

What would cause an unfavorable,U,variance in the fixed overhead flexible-budget?

Accepted Answer

An unfavorable (U)variance res

Question 19

The managerial accountant prepared the following Level-1 analysis for The Halcyon Carpet renewal system company:
 
Required
Compute the static-budget variances of (a)units sold; (b)revenues; (c)direct materials; (d)direct manufacturing labor; (e)variable manufacturing overhead; (f)total variable costs; (g)contribution margin; (h)fixed costs; (i)operating income.

Accepted Answer

A) (a)15,000, (b)$75,000,U, (c)$85,600, (d)$8,000,U, (e)$17,500, (f)$95,100,F, (g)$89,000, (h)$13,000,U, (i)$102,000,U. 
B) (a)17,000, (b)$80,000,F, (c)$92,300, (d)$6,000,U, (e)$12,600, (f)$98,100,U, (g)$93,000, (h)$15,000,F, (i)$112,000,F. 
C) (a)13,000, (b)$85,000,F, (c)$95,000, (d)$4,000,F, (e)$14,300, (f)$103,000,F, (g)$95,000, (h)$108,000,U, (i)$135,000,U 
D) (a)16,000 (b)$85,000,F, (c)$64,200, (d)$18,000,U, (e)$7,000, (f)$113,000,F, (g)$75,000, (h)$78,000,U, (i)$103,000,F. 
E) (a)9,000, (b)$54,000,F, (c)$68,000, (d)$12,000,U, (e)$23,000, (f)$110,500,U, (g)$63,000, (h)$92,000,F, (i)$100,000,U. 
A) (a)15,000, (b)$75,000,U, (c)$85,600, (d)$8,000,U, (e)$17,500, (f)$95,100,F, (g)$89,000, (h)$13,000,U, (i)$102,000,U. 
B) (a)17,000, (b)$80,000,F, (c)$92,300, (d)$6,000,U, (e)$12,600, (f)$98,100,U, (g)$93,000, (h)$15,000,F, (i)$112,000,F. 
C) (a)13,000, (b)$85,000,F, (c)$95,000, (d)$4,000,F, (e)$14,300, (f)$103,000,F, (g)$95,000, (h)$108,000,U, (i)$135,000,U 
D) (a)16,000 (b)$85,000,F, (c)$64,200, (d)$18,000,U, (e)$7,000, (f)$113,000,F, (g)$75,000, (h)$78,000,U, (i)$103,000,F. 
E) (a)9,000, (b)$54,000,F, (c)$68,000, (d)$12,000,U, (e)$23,000, (f)$110,500,U, (g)$63,000, (h)$92,000,F, (i)$100,000,U.

Question 20

The managerial accountant at Rainy Day Umbrella Company needs to calculate the direct material cost per umbrella that is manufactured.The company produced 35,000 umbrellas in the fiscal year with a direct material total cost of $760,000.
Required
Compute the direct material cost per umbrella.

Accepted Answer

A) $35.46 per umbrella 
B) $23.60 per umbrella 
C) $32.50 per umbrella 
D) $21.71 per umbrella 
E) $18.50 per umbrella 
A) $35.46 per umbrella 
B) $23.60 per umbrella 
C) $32.50 per umbrella 
D) $21.71 per umbrella 
E) $18.50 per umbrella

What three sources do managers use to obtain budgeted input prices and budgeted input quantities?

Possible operational causes of a direct materials efficiency unfavorable variance include all of the following except:

________ is the difference between actual quantity of the cost-allocation base used and budgeted quantity of the cost-allocation base that should have been used to produce actual output,multiplied by budgeted variable overhead cost per unit of the cost-allocation base.

How does the planning of fixed overhead costs differ from the planning of variable overhead costs?

Management can get further insight in the reason of flexible-budget variance for direct-cost input variances when they subdivide them into ________ and spending variances.

Why is constructing and using a flexible budget beneficial to management?

A sales-volume variance is the difference between a flexible budget amount and what other data factor?

B&C Entertainment,film distribution center,has a static-budget operating income of $164,000 and an actual operating income of $48,000. Required Compute the static-budget variance for operating income and identify whether the variance is favorable,F,or unfavorable,U.

What could cause the two manufacturing efficiency variances,direct materials efficiency variance and the direct manufacturing labor efficiency variable,to show as unfavorable?

The expected performance is also referred to as the ________.

Managers find it useful to subdivide the flexible-budget variance for direct cost variance into a ________ variance and an efficiency variance.

In March 2013,Busy Brains Text Company produced and sold 26,000 textbooks,each at a cost of $230. Required Compute the flexible-budget revenues for textbooks.

The managerial accountant at Diamond Manufacturing reported that the static-budget operating income of $110,000 for 12,000 diamond-stud jackets is $9.16 per jacket.The manager reported a shortfall of 1,800 jackets. Required Compute the operating-income volume variance.

Variable overhead has a production-volume variance.

What are the benefits of variance analysis to a public official?

What would cause an unfavorable,U,variance in the fixed overhead flexible-budget?

The managerial accountant at Rainy Day Umbrella Company needs to calculate the direct material cost per umbrella that is manufactured.The company produced 35,000 umbrellas in the fiscal year with a direct material total cost of $760,000. Required Compute the direct material cost per umbrella.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Pricing Decisions, customer Profitability, and Cost Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters

Exam 13: Flexible Budgets, cost Variances, and Management Control

What three sources do managers use to obtain budgeted input prices and budgeted input quantities?

Possible operational causes of a direct materials efficiency unfavorable variance include all of the following except:

________ is the difference between actual quantity of the cost-allocation base used and budgeted quantity of the cost-allocation base that should have been used to produce actual output,multiplied by budgeted variable overhead cost per unit of the cost-allocation base.

How does the planning of fixed overhead costs differ from the planning of variable overhead costs?

Management can get further insight in the reason of flexible-budget variance for direct-cost input variances when they subdivide them into ________ and spending variances.

Why is constructing and using a flexible budget beneficial to management?

A sales-volume variance is the difference between a flexible budget amount and what other data factor?

B&C Entertainment,film distribution center,has a static-budget operating income of $164,000 and an actual operating income of $48,000. Required Compute the static-budget variance for operating income and identify whether the variance is favorable,F,or unfavorable,U.

What could cause the two manufacturing efficiency variances,direct materials efficiency variance and the direct manufacturing labor efficiency variable,to show as unfavorable?

The expected performance is also referred to as the ________.

Managers find it useful to subdivide the flexible-budget variance for direct cost variance into a ________ variance and an efficiency variance.

In March 2013,Busy Brains Text Company produced and sold 26,000 textbooks,each at a cost of $230. Required Compute the flexible-budget revenues for textbooks.

The managerial accountant at Diamond Manufacturing reported that the static-budget operating income of $110,000 for 12,000 diamond-stud jackets is $9.16 per jacket.The manager reported a shortfall of 1,800 jackets. Required Compute the operating-income volume variance.

Variable overhead has a production-volume variance.

What are the benefits of variance analysis to a public official?

What would cause an unfavorable,U,variance in the fixed overhead flexible-budget?

The managerial accountant at Rainy Day Umbrella Company needs to calculate the direct material cost per umbrella that is manufactured.The company produced 35,000 umbrellas in the fiscal year with a direct material total cost of $760,000. Required Compute the direct material cost per umbrella.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Pricing Decisions, customer Profitability, and Cost Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters