Zennick Fashion Products uses standard costs for their manufacturing division. Standards specify 3.0 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following data: \[\begin{array}{l} \begin{array} { l l } \text { Production volume: } & 1,000 \text { units } \\ \text { Estimated variable overhead costs: } & \$ 120,000 \\ \text { Estimated direct labor hours: } & 3,000 \text { hours } \end{array}\\ \text { At the end of the year, actual data were as follows: }\\ \begin{array} { l l } \text { Production volume: } & 1,500 \text { units } \\ \text { Actual variable overhead costs: } & \$ 174,300 \\ \text { Actual direct labor hours: } & 4,200 \text { hours } \end{array} \end{array}\] - How much is the spending (price) variance for variable overhead?

A) $6,300 Favorable B) $6,300 Unfavorable C) $12,000 Favorable D) $12,000 Unfavorable A) $6,300 Favorable B) $6,300 Unfavorable C) $12,000 Favorable D) $12,000 Unfavorable

Alpine Productions uses a standard costing system for recording transactions; they also prepare an internal-use income statement using standard cost methodology. At the end of 2011, Alpine reported the following data: Sales Revenues: $500,000 Cost of Goods Sold (standard costing) $382,500 Marketing & Admin expenses $105,000 Variances: $\begin{array}{|l|r|c|} \hline \text { Sales revenue } & \$ 4,000 & F \\ \hline \text { Direct materials price variance } & 20 & \mathrm{U} \\ \hline \text { Direct materials efficiency variance } & 300 & \mathrm{~F} \\ \hline \text { Direct labor price variance } & 75 & \mathrm{U} \\ \hline \text { Direct labor efficiency variance } & 10 & \mathrm{~F} \\ \hline \text { Variable overhead spending variance } & 225 & \mathrm{U} \\ \hline \text { Variable overhead efficiency variance } & 80 & \mathrm{~F} \\ \hline \text { Fixed overhead spending variance } & 420 & \mathrm{U} \\ \hline \text { Fixed overhead volume variance } & 110 & \mathrm{~F} \\ \hline \end{array}$ Using the format below, please prepare a statement of operating income. \[\begin{array} { | l | l | l | l | } \hline \text { Sales revenue (standard) } & & & \\ \hline \text { Sales revenue variance } & & & \\ \hline \text { Sales revenue (actual) } & & & \\ \hline \text { Cost of goods sold (standard) } & & & \\ \hline \text { Manufacturing variances } & & & \\ \hline \text { (Credit balances in parentheses) } & & & \\ \hline \text { Direct materials price variance } & & & \\ \hline \text { Direct materials efficiency variance } & & & \\ \hline \text { Direct labor price variance } & & & \\ \hline \text { Direct labor efficiency variance } & & & \\ \hline \text { Variable overhead spending variance } & & & \\ \hline \text { Variable overhead efficiency variance } & & & \\ \hline \text { Fixed overhead spending variance } & & & \\ \hline \text { Fixed overhead volume variance } & & & \\ \hline \text { Cost of goods sold (actual) } & & & \\ \hline \text { Gross profit } & & & \\ \hline \text { Marketing and admin. expenses } & & & \\ \hline \text { Net operating income/(loss) } & & & \\ \hline \end{array}\]

\[\begin{array} { | l | l | l | l | } \

The following information describes a company's usage of direct labor in a recent period: $\begin{array}{|l|r|} \hline \text { Actual direct labor hours used } & 44,000 \\ \hline \text { Actual rate per hour } & \$ 20 \\ \hline\text { Standard rate per hour } & \$ 18 \\ \hline \text { Standard hours for units produced } & 42,000 \\ \hline \end{array}$ - How much is the direct labor efficiency variance?

A) $40,000 unfavorable B) $40,000 favorable C) $36,000 favorable D) $36,000 unfavorable A) $40,000 unfavorable B) $40,000 favorable C) $36,000 favorable D) $36,000 unfavorable

Allbrand Company uses standard costs for their manufacturing division. Standards specify 0.1 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following data: \[\begin{array}{l} \begin{array} { l l } \text { Production volume: } & 5,000 \text { units } \\ \text { Estimated variable overhead costs: } & \$ 12,500 \\ \text { Estimated direct labor hours: } & 500 \text { hours } \end{array}\\ \text { At the end of the year, actual data were as follows: }\\ \begin{array} { l l } \text { Production volume: } & 4,000 \text { units } \\ \text { Actual variable overhead costs: } & \$ 11,760 \\ \text { Actual direct labor hours: } & 480 \text { hours } \end{array} \end{array}\] - How much is the spending (price) variance for variable overhead?

A) $2,000 Favorable B) $2,000 Unfavorable C) $240 Favorable D) $240 Unfavorable A) $2,000 Favorable B) $2,000 Unfavorable C) $240 Favorable D) $240 Unfavorable

Exam 23: Flexible Budgets and Standard Costs

Zennick Fashion Products uses standard costs for their manufacturing division. Standards specify 3.0 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following data: Production volume: 1,000 units Estimated variable overhead costs: \ 120,000 Estimated direct labor hours: 3,000 hours At the end of the year, actual data were as follows: Production volume: 1,500 units Actual variable overhead costs: \ 174,300 Actual direct labor hours: 4,200 hours - How much is the spending (price) variance for variable overhead?

(Multiple Choice)

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Question 61

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the sales volume variance for variable expenses?

(Multiple Choice)

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Question 62

Faas Marine Stores Company manufactures decorative fittings for luxury yachts which require highly skilled labor, and special metallic materials. Faas uses standard costs to prepare its flexible budget. For the first quarter of 2011, direct material and direct labor standards for one of their popular products were as follows: Materials: 1.5 pounds per unit; \ 4.00 per pound Labor: 2.0 hours per unit; \ 18.00 per hour During the first quarter, Faas produced 5,000 units of this product. - Actual direct materials costs were $29,750. Actual direct labor costs were $184,800. Faas is now preparing an analysis of actual versus flexible budget. Using the reporting format below, please complete the data for direct materials and direct labor costs, and fill in all remaining data cells. $Faas Marine Stores Company manufactures decorative fittings for luxury yachts which require highly skilled labor, and special metallic materials. Faas uses standard costs to prepare its flexible budget. For the first quarter of 2011, direct material and direct labor standards for one of their popular products were as follows: \begin{array} { l l } \text { Materials: } & 1.5 \text { pounds per unit; } \$ 4.00 \text { per pound } \\ \text { Labor: } & 2.0 \text { hours per unit; } \$ 18.00 \text { per hour } \end{array} During the first quarter, Faas produced 5,000 units of this product. - Actual direct materials costs were $29,750. Actual direct labor costs were $184,800. Faas is now preparing an analysis of actual versus flexible budget. Using the reporting format below, please complete the data for direct materials and direct labor costs, and fill in all remaining data cells.$

(Essay)

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Question 63

ABBA Manufacturing makes staplers. The budgeted selling price is $10 per stapler, the variable rate is $5 per stapler and budgeted fixed costs are $12,000. What is the budgeted operating income for 5,000 staplers?

(Multiple Choice)

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Question 64

Faas Marine Stores Company manufactures decorative fittings for luxury yachts which require highly skilled labor, and special metallic materials. Faas uses standard costs to prepare its flexible budget. For the first quarter of 2011, direct material and direct labor standards for one of their popular products were as follows: Materials: 1.5 pounds per unit; \ 4.00 per pound Labor: 2.0 hours per unit; \ 18.00 per hour - During the first quarter, Faas produced 5,000 units of this product. At the end of the quarter, an examination of the materials records showed that the company used 7,000 pounds of materials and actual total material costs were $29,750. How much is the direct materials price variance?

(Multiple Choice)

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Question 65

Which of the following BEST describes sales volume variance?

(Multiple Choice)

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Question 66

Faas Marine Stores Company manufactures decorative fittings for luxury yachts which require highly skilled labor, and special metallic materials. Faas uses standard costs to prepare its flexible budget. For the first quarter of 2011, direct material and direct labor standards for one of their popular products were as follows: Materials: 1.5 pounds per unit; \ 4.00 per pound Labor: 2.0 hours per unit; \ 18.00 per hour During the first quarter, Faas produced 5,000 units of this product. Actual direct materials costs were $29,750. Actual direct labor costs were $184,800. For purposes of preparing the flexible budget, what is the total standard direct materials cost at a production volume of 5,000 units?

(Multiple Choice)

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Question 67

What does a favorable direct materials price variance indicate?

(Multiple Choice)

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Question 68

Which of the following will result in an unfavorable direct materials efficiency variance?

(Multiple Choice)

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Question 69

Onyx Company prepared a static budget at the beginning of the month. At the end of the month, the company is analyzing actual results versus budget using flexible budget methodology. Data are as follows: Static budget: Sales volume: 1,000 units Price: $70 per unit Variable expense: $32 per unit Fixed expenses: $37,500 per month Operating income: $500 Actual results: Sales volume: 990 units Price: $74 per unit Variable expense: $35 per unit Fixed expenses: $33,000 per month Operating income: $5,610 - Based on the above data, how much was the flexible budget variance for operating income?

(Multiple Choice)

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Question 70

The actual cost of direct materials is $10.50 per pound. The standard cost per pound is $11.75. During the current period, 10,000 pounds were used in production. The standard quantity for actual units produced is 9,900 pounds. How much is the direct materials efficiency variance?

(Multiple Choice)

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Question 71

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual fixed expenses were lower than projected in the static budget. What kind of variance would that produce?

(Multiple Choice)

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Question 72

Alpine Productions uses a standard costing system for recording transactions; they also prepare an internal-use income statement using standard cost methodology. At the end of 2011, Alpine reported the following data: Sales Revenues: $500,000 Cost of Goods Sold (standard costing) $382,500 Marketing & Admin expenses $105,000 Variances: Sales revenue \ 4,000 F Direct materials price variance 20 Direct materials efficiency variance 300 Direct labor price variance 75 Direct labor efficiency variance 10 Variable overhead spending variance 225 Variable overhead efficiency variance 80 Fixed overhead spending variance 420 Fixed overhead volume variance 110 Using the format below, please prepare a statement of operating income. Sales revenue (standard) Sales revenue variance Sales revenue (actual) Cost of goods sold (standard) Manufacturing variances (Credit balances in parentheses) Direct materials price variance Direct materials efficiency variance Direct labor price variance Direct labor efficiency variance Variable overhead spending variance Variable overhead efficiency variance Fixed overhead spending variance Fixed overhead volume variance Cost of goods sold (actual) Gross profit Marketing and admin. expenses Net operating income/(loss)

(Essay)

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Question 73

The following information describes a company's usage of direct labor in a recent period: Actual direct labor hours used 44,000 Actual rate per hour \ 20 Standard rate per hour \ 18 Standard hours for units produced 42,000 - How much is the direct labor efficiency variance?

(Multiple Choice)

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Question 74

The production manager of a company was experiencing high defect rate on the assembly line, which was slowing production and causing wastage of valuable materials. He decided recruit some highly skilled production workers from another company to bring down the defect rate, but he was worried that the higher wages of these workers might negatively impact operating income. This situation could have produced which of the following variances?

(Multiple Choice)

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Question 75

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the flexible budget variance for variable expenses?

(Multiple Choice)

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Question 76

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual selling price was higher than projected in the static budget. What kind of variance would that produce?

(Multiple Choice)

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Question 77

In a flexible budget, which of the following amounts stays the same as the volume changes?

(Multiple Choice)

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Question 78

Allbrand Company uses standard costs for their manufacturing division. Standards specify 0.1 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following data: Production volume: 5,000 units Estimated variable overhead costs: \ 12,500 Estimated direct labor hours: 500 hours At the end of the year, actual data were as follows: Production volume: 4,000 units Actual variable overhead costs: \ 11,760 Actual direct labor hours: 480 hours - How much is the spending (price) variance for variable overhead?

(Multiple Choice)

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Question 79

Faas Marine Stores Company manufactures decorative fittings for luxury yachts which require highly skilled labor, and special metallic materials. Faas uses standard costs to prepare its flexible budget. For the first quarter of 2011, direct material and direct labor standards for one of their popular products were as follows: Materials: 1.5 pounds per unit; \ 4.00 per pound Labor: 2.0 hours per unit; \ 18.00 per hour - During the first quarter, Faas produced 5,000 units of this product. Actual direct materials costs were $29,750. Actual direct labor costs were $184,800. For purposes of calculating the flexible budget variances, what is the direct materials cost variance?

(Multiple Choice)

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Question 80

Showing 61 - 80 of 165

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the sales volume variance for variable expenses?

ABBA Manufacturing makes staplers. The budgeted selling price is $10 per stapler, the variable rate is $5 per stapler and budgeted fixed costs are $12,000. What is the budgeted operating income for 5,000 staplers?

Which of the following BEST describes sales volume variance?

What does a favorable direct materials price variance indicate?

Which of the following will result in an unfavorable direct materials efficiency variance?

The actual cost of direct materials is $10.50 per pound. The standard cost per pound is $11.75. During the current period, 10,000 pounds were used in production. The standard quantity for actual units produced is 9,900 pounds. How much is the direct materials efficiency variance?

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual fixed expenses were lower than projected in the static budget. What kind of variance would that produce?

The following information describes a company's usage of direct labor in a recent period: Actual direct labor hours used 44,000 Actual rate per hour \ 20 Standard rate per hour \ 18 Standard hours for units produced 42,000 - How much is the direct labor efficiency variance?

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the flexible budget variance for variable expenses?

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual selling price was higher than projected in the static budget. What kind of variance would that produce?

In a flexible budget, which of the following amounts stays the same as the volume changes?

Corporations: Paid-In Capital and the Balance Sheet

Corporations: Effects on Retained Earnings and the Income Statement

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Management Accounting

Job Order and Process Costing

Activity-Based Costing and Other Cost Management Tools

Cost-Volume-Profit Analysis

Short-Term Business Decisions

Capital Investment Decisions and the Time Value of Money

The Master Budget and Responsibility Accounting

Performance Evaluation and the Balanced Scorecard

Filters

Exam 23: Flexible Budgets and Standard Costs

The Carolina Products Company has just completed a flexible budget analysis of 2nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the sales volume variance for variable expenses?

ABBA Manufacturing makes staplers. The budgeted selling price is $10 per stapler, the variable rate is $5 per stapler and budgeted fixed costs are $12,000. What is the budgeted operating income for 5,000 staplers?

Which of the following BEST describes sales volume variance?

What does a favorable direct materials price variance indicate?

Which of the following will result in an unfavorable direct materials efficiency variance?

The actual cost of direct materials is $10.50 per pound. The standard cost per pound is $11.75. During the current period, 10,000 pounds were used in production. The standard quantity for actual units produced is 9,900 pounds. How much is the direct materials efficiency variance?

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual fixed expenses were lower than projected in the static budget. What kind of variance would that produce?

The following information describes a company's usage of direct labor in a recent period: Actual direct labor hours used 44,000 Actual rate per hour \ 20 Standard rate per hour \ 18 Standard hours for units produced 42,000 - How much is the direct labor efficiency variance?

The Carolina Products Company has just completed a flexible budget analysis of 2nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the flexible budget variance for variable expenses?

A company is analyzing month-end results compared to both static and flexible budgets. This month the actual selling price was higher than projected in the static budget. What kind of variance would that produce?

In a flexible budget, which of the following amounts stays the same as the volume changes?

Corporations: Paid-In Capital and the Balance Sheet

Corporations: Effects on Retained Earnings and the Income Statement

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Management Accounting

Job Order and Process Costing

Activity-Based Costing and Other Cost Management Tools

Cost-Volume-Profit Analysis

Short-Term Business Decisions

Capital Investment Decisions and the Time Value of Money

The Master Budget and Responsibility Accounting

Performance Evaluation and the Balanced Scorecard

Filters

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the sales volume variance for variable expenses?

The Carolina Products Company has just completed a flexible budget analysis of 2^nd quarter operating income, as shown here: - Based on the above data, which of the following statements would be a correct interpretation of the flexible budget variance for variable expenses?