Question 1

Variances assist managers in implementing their strategies by enabling ________.

Accepted Answer

A) variant budgeting 
B) directed functioning 
C) divisional awareness 
D) deviational sentience 
E) management by exception 
A) variant budgeting 
B) directed functioning 
C) divisional awareness 
D) deviational sentience 
E) management by exception

Question 2

The fixed overhead spending variance informs managers of the difference between actual spending on fixed overhead and the planned amount of spending in what budget?

Accepted Answer

A) Static budget. 
B) Fixed budget. 
C) Master budget. 
D) Variable budget. 
E) Three-year budget. 
A) Static budget. 
B) Fixed budget. 
C) Master budget. 
D) Variable budget. 
E) Three-year budget.

Question 3

How can managers respond to unfavorable sales-volume variances?

Accepted Answer

If managers believe the unfavorable sale

Question 4

Variable overhead flexible-budget variance measures the difference between ________ and flexible-budget variable overhead amounts.

Accepted Answer

A) expected overhead variance cost 
B) past data of variable overhead costs 
C) actual variable overhead costs incurred 
D) the revenue effect of price of recovery 
E) the cost effect of price recovery for fixed costs 
A) expected overhead variance cost 
B) past data of variable overhead costs 
C) actual variable overhead costs incurred 
D) the revenue effect of price of recovery 
E) the cost effect of price recovery for fixed costs

Question 5

In what important way is the planning of fixed overhead costs different from the planning of variable overhead costs?

Accepted Answer

A) Timing. 
B) Return on assets. 
C) Peak consumption periods. 
D) Imposed limits on customers. 
E) Choosing the appropriate level of capacity. 
A) Timing. 
B) Return on assets. 
C) Peak consumption periods. 
D) Imposed limits on customers. 
E) Choosing the appropriate level of capacity.

Question 6

When should managers investigate the cause of variances?

Accepted Answer

Frequently,managers investigate variance

Question 7

Can managers use both financial and non-financial performance measures to evaluate manager performance?

Accepted Answer

Nonfinancial measures provide feedback o

Question 8

The goal of variance analysis is for managers to understand why variances arise,to learn,and to improve future performance.

Accepted Answer

A) True 
 B)False

Question 9

Why should management be careful when drawing conclusions regarding a company's decisions about capacity planning and usage from the type (Favorable,F;or,unfavorable variance)or the magnitude associated with a production-volume variance?

Accepted Answer

To interpret a production-volume varianc

Question 10

BlueRing Corporation planned to use $169 of material per unit but actually used $165 of material per unit,and planned to make 1,500 units,but actually made 1,300 units.
Required:
Compute the flexible budget,the flexible-budget variance,and the sales-volume variance.

Accepted Answer

A) $253,500;$(5,200);$(33,800) 
B) $254,500;$(6,200);$(34,900) 
C) $255,000;$(7,200);$(35,900) 
D) $256,000;$(8,200)' $(36,900) 
E) $257,000;$(9,200);$(37,000) 
A) $253,500;$(5,200);$(33,800) 
B) $254,500;$(6,200);$(34,900) 
C) $255,000;$(7,200);$(35,900) 
D) $256,000;$(8,200)' $(36,900) 
E) $257,000;$(9,200);$(37,000)

Question 11

The production-volume variance forms part of sales-volume variance.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements is an advantage to managers who use data from other companies that have similar processes?

Accepted Answer

A) Input-price data from other companies are often not available. 
B) Input-quantity data from other companies are often not available. 
C) Input-price data may not be comparable to a particular company's situation. 
D) Input-quantity data may not be comparable to a particular company's situation. 
E) The budget numbers represent competitive benchmarks from other companies. 
A) Input-price data from other companies are often not available. 
B) Input-quantity data from other companies are often not available. 
C) Input-price data may not be comparable to a particular company's situation. 
D) Input-quantity data may not be comparable to a particular company's situation. 
E) The budget numbers represent competitive benchmarks from other companies.

Question 13

The difference between the static-budget and the flexible-budget amounts is the ________.

Accepted Answer

A) unused capacity 
B) growth component 
C) sales volume variance 
D) flexible-budget variance 
E) balanced scorecard 
A) unused capacity 
B) growth component 
C) sales volume variance 
D) flexible-budget variance 
E) balanced scorecard

Question 14

The fixed overhead flexible-budget variance is the difference between ________ and fixed overhead costs in the flexible budget.

Accepted Answer

A) the actual results 
B) the static budget 
C) fixed overhead costs 
D) actual fixed overhead costs 
E) budgeted fixed overhead costs 
A) the actual results 
B) the static budget 
C) fixed overhead costs 
D) actual fixed overhead costs 
E) budgeted fixed overhead costs

Question 15

The managerial accountant at Perfect Manufacturing reported the following information:
 
Required
Compute the sales-volume variance and indicate whether or not the variance is favorable or unfavorable.

Accepted Answer

A) $30,000 F 
B) $30,000 U 
C) $70,000 F 
D) $70,000 U 
E) $75,000 F 
A) $30,000 F 
B) $30,000 U 
C) $70,000 F 
D) $70,000 U 
E) $75,000 F

Question 16

Laurel Corporation used the following data to evaluate their current operating system.The company sells items to $30 each and used a budgeted selling price $30 per unit.
 
Required:
Compute the static-budget variance of revenues,the static-budget variance of variable costs,and the static-budget variance of operating income.

Accepted Answer

A) $30,000 F;$9,000 U;$23,250 F 
B) $32,000 U;$9,100 F;$23,400 F 
C) $33,000 F;$9,150 F;$23,410 F 
D) $33,100 F;$9,200 U;$23,420 U 
E) $33,200 U;$9,250 F;$23,430 F 
A) $30,000 F;$9,000 U;$23,250 F 
B) $32,000 U;$9,100 F;$23,400 F 
C) $33,000 F;$9,150 F;$23,410 F 
D) $33,100 F;$9,200 U;$23,420 U 
E) $33,200 U;$9,250 F;$23,430 F

Question 17

Detailed variance analyses are most common in large,complex businesses because it is impossible for managers to keep track of what occurs in specific responsibility areas.

Accepted Answer

A) True 
 B)False

Question 18

What is a disadvantage to managers that use actual input data from past periods to calculate price and efficiency variances?

Accepted Answer

A) Past data is typically available at low cost. 
B) Past data is advantageous because it excludes inefficiencies. 
C) Past data can serve as benchmarks for continuous improvement. 
D) Past data can include inefficiencies and does not incorporate any changes expected for the budget period. 
E) Past data represents quantities and prices that are real,rather than hypothetical. 
A) Past data is typically available at low cost. 
B) Past data is advantageous because it excludes inefficiencies. 
C) Past data can serve as benchmarks for continuous improvement. 
D) Past data can include inefficiencies and does not incorporate any changes expected for the budget period. 
E) Past data represents quantities and prices that are real,rather than hypothetical.

Question 19

The Manufacturing Material Company reported the following information:
 
Required
Compute the standard direct manufacturing labor cost per unit.

Accepted Answer

A) $15.00 
B) $15.50 
C) $15.75 
D) $16.00 
E) $16.20 
A) $15.00 
B) $15.50 
C) $15.75 
D) $16.00 
E) $16.20

Question 20

In what type of situation would management want to subdivide a flexible-budget variance into the efficiency variance and the spending variance?

Accepted Answer

An unfavorable flexible-budget

Variances assist managers in implementing their strategies by enabling ________.

The fixed overhead spending variance informs managers of the difference between actual spending on fixed overhead and the planned amount of spending in what budget?

How can managers respond to unfavorable sales-volume variances?

Variable overhead flexible-budget variance measures the difference between ________ and flexible-budget variable overhead amounts.

In what important way is the planning of fixed overhead costs different from the planning of variable overhead costs?

When should managers investigate the cause of variances?

Can managers use both financial and non-financial performance measures to evaluate manager performance?

The goal of variance analysis is for managers to understand why variances arise,to learn,and to improve future performance.

Why should management be careful when drawing conclusions regarding a company's decisions about capacity planning and usage from the type (Favorable,F;or,unfavorable variance)or the magnitude associated with a production-volume variance?

BlueRing Corporation planned to use $169 of material per unit but actually used $165 of material per unit,and planned to make 1,500 units,but actually made 1,300 units. Required: Compute the flexible budget,the flexible-budget variance,and the sales-volume variance.

The production-volume variance forms part of sales-volume variance.

Which of the following statements is an advantage to managers who use data from other companies that have similar processes?

The difference between the static-budget and the flexible-budget amounts is the ________.

The fixed overhead flexible-budget variance is the difference between ________ and fixed overhead costs in the flexible budget.

The managerial accountant at Perfect Manufacturing reported the following information: Required Compute the sales-volume variance and indicate whether or not the variance is favorable or unfavorable.

Detailed variance analyses are most common in large,complex businesses because it is impossible for managers to keep track of what occurs in specific responsibility areas.

What is a disadvantage to managers that use actual input data from past periods to calculate price and efficiency variances?

The Manufacturing Material Company reported the following information: Required Compute the standard direct manufacturing labor cost per unit.

In what type of situation would management want to subdivide a flexible-budget variance into the efficiency variance and the spending variance?

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

Variances assist managers in implementing their strategies by enabling ________.

The fixed overhead spending variance informs managers of the difference between actual spending on fixed overhead and the planned amount of spending in what budget?

How can managers respond to unfavorable sales-volume variances?

Variable overhead flexible-budget variance measures the difference between ________ and flexible-budget variable overhead amounts.

In what important way is the planning of fixed overhead costs different from the planning of variable overhead costs?

When should managers investigate the cause of variances?

Can managers use both financial and non-financial performance measures to evaluate manager performance?

The goal of variance analysis is for managers to understand why variances arise,to learn,and to improve future performance.

Why should management be careful when drawing conclusions regarding a company's decisions about capacity planning and usage from the type (Favorable,F;or,unfavorable variance)or the magnitude associated with a production-volume variance?

BlueRing Corporation planned to use $169 of material per unit but actually used $165 of material per unit,and planned to make 1,500 units,but actually made 1,300 units. Required: Compute the flexible budget,the flexible-budget variance,and the sales-volume variance.

The production-volume variance forms part of sales-volume variance.

Which of the following statements is an advantage to managers who use data from other companies that have similar processes?

The difference between the static-budget and the flexible-budget amounts is the ________.

The fixed overhead flexible-budget variance is the difference between ________ and fixed overhead costs in the flexible budget.

The managerial accountant at Perfect Manufacturing reported the following information: Required Compute the sales-volume variance and indicate whether or not the variance is favorable or unfavorable.

Detailed variance analyses are most common in large,complex businesses because it is impossible for managers to keep track of what occurs in specific responsibility areas.

What is a disadvantage to managers that use actual input data from past periods to calculate price and efficiency variances?

The Manufacturing Material Company reported the following information: Required Compute the standard direct manufacturing labor cost per unit.

In what type of situation would management want to subdivide a flexible-budget variance into the efficiency variance and the spending variance?

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