Question 1

Variable costing considers fixed manufacturing overhead costs as a(n)________.

Accepted Answer

A) inventoriable cost 
B) product cost 
C) future cost 
D) immediate expense 
A) inventoriable cost 
B) product cost 
C) future cost 
D) immediate expense

Question 2

Couric Company reported the following information about the production and sale of its only product during the first month of operations:   Under absorption costing,what is the Cost of Goods Sold?

Accepted Answer

A) $63,000 
B) $103,000 
C) $126,000 
D) $206,000 
A) $63,000 
B) $103,000 
C) $126,000 
D) $206,000

Question 3

There is no difference between variable-costing operating income and absorption-costing operating income if there is no ________.

Accepted Answer

A) beginning inventory of finished goods 
B) ending inventory of finished goods 
C) variable overhead costs 
D) change in finished goods inventory during the period 
A) beginning inventory of finished goods 
B) ending inventory of finished goods 
C) variable overhead costs 
D) change in finished goods inventory during the period

Question 4

The two key items in determining the budgeted factory overhead application rate are total budgeted factory overhead costs and ________.

Accepted Answer

A) actual amount of the cost driver 
B) total actual factory overhead costs 
C) budgeted amount of cost driver 
D) total estimated factory overhead costs 
A) actual amount of the cost driver 
B) total actual factory overhead costs 
C) budgeted amount of cost driver 
D) total estimated factory overhead costs

Question 5

There is no production volume variance when expected production volume equals actual production volume.

Accepted Answer

A) True 
 B)False

Question 6

The following data are available for Scream Company for the year ended December 31,2015:
   Required: 
A)Using the variable-costing approach,prepare an income statement for the year ended December 31,2015.Assume actual fixed costs were equal to budgeted fixed costs.
B)Using the absorption-costing approach,prepare an income statement for the year ended December 31,2015.Assume actual fixed costs were equal to budgeted fixed costs.

Accepted Answer

A) @#IMG-DLM& Variab

Question 7

No one cost driver is appropriate for all situations.

Accepted Answer

A) True 
 B)False

Question 8

White Company had the following information:   Assume the cost driver for factory overhead costs is direct labor hours.What amount of factory overhead is applied to the products produced?

Accepted Answer

A) $137,700 
B) $142,922 
C) $144,500 
D) $149,980 
A) $137,700 
B) $142,922 
C) $144,500 
D) $149,980

Question 9

Most companies consider production volume variances to be beyond a manager's immediate control.

Accepted Answer

A) True 
 B)False

Question 10

The variable-costing method does not include fixed overhead costs in a product's costs.

Accepted Answer

A) True 
 B)False

Question 11

Why do companies use variable costing for internal financial statements?

Accepted Answer

A) Production volume variance does not affect variable costing income but it does affect absorption costing income. 
B) Variable costing does not create an incentive to produce additional unneeded units to increase net income. 
C) A sales-oriented company wants to track the effect of sales on net income. 
D) All of the above 
A) Production volume variance does not affect variable costing income but it does affect absorption costing income. 
B) Variable costing does not create an incentive to produce additional unneeded units to increase net income. 
C) A sales-oriented company wants to track the effect of sales on net income. 
D) All of the above

Question 12

When the number of units sold exceeds the number of units produced,net income under variable costing ________ net income under absorption costing.

Accepted Answer

A) is less than 
B) exceeds 
C) equals 
D) not enough information to determine 
A) is less than 
B) exceeds 
C) equals 
D) not enough information to determine

Question 13

Jones Corporation uses a budgeted factory overhead rate to apply overhead to production.Direct labor costs are the cost driver for overhead costs.The following data are available for the year ending December 31,2010:
   Required: 
A)Compute the budgeted factory overhead rate.
B)Compute the applied overhead costs.
C)What is the overhead variance?
D)Prorate the overhead variance to the appropriate accounts.

Accepted Answer

A)$675,000/$450,000 = 150% of direct lab

Question 14

Stars Company reported the following information about the production and sale of its only product during the first month of operations:   Under absorption costing,what is the product cost per unit?

Accepted Answer

A) $130.00 
B) $160.00 
C) $200.00 
D) $225.00 
A) $130.00 
B) $160.00 
C) $200.00 
D) $225.00

Question 15

The most widely used approach in disposing of an overhead variance is proration to the affected accounts.

Accepted Answer

A) True 
 B)False

Question 16

When calculating the budgeted overhead rate,the numerator of the fraction is the actual amount of the cost driver.

Accepted Answer

A) True 
 B)False

Question 17

To apply the budgeted overhead costs to a job,the budgeted overhead rate is multiplied by the ________.

Accepted Answer

A) actual production in units 
B) expected production in units 
C) actual amount of cost driver used by the job 
D) expected amount of cost driver used by the job 
A) actual production in units 
B) expected production in units 
C) actual amount of cost driver used by the job 
D) expected amount of cost driver used by the job

Question 18

The production volume variance is the difference between ________.

Accepted Answer

A) expected fixed overhead costs and actual fixed overhead costs 
B) expected fixed overhead costs and budgeted fixed overhead costs 
C) budgeted fixed overhead costs and actual fixed overhead costs 
D) budgeted fixed overhead costs and applied fixed overhead costs 
A) expected fixed overhead costs and actual fixed overhead costs 
B) expected fixed overhead costs and budgeted fixed overhead costs 
C) budgeted fixed overhead costs and actual fixed overhead costs 
D) budgeted fixed overhead costs and applied fixed overhead costs

Question 19

Gross margin is a subtotal on a variable-costing income statement.

Accepted Answer

A) True 
 B)False

Question 20

Schmidt Company reported the following information about the production and sale of its only product during the first month of operations:   Under variable costing,what is the product cost per unit?

Accepted Answer

A) $35.00 
B) $36.25 
C) $37.92 
D) $65.00 
A) $35.00 
B) $36.25 
C) $37.92 
D) $65.00

Variable costing considers fixed manufacturing overhead costs as a(n)________.

Couric Company reported the following information about the production and sale of its only product during the first month of operations: Under absorption costing,what is the Cost of Goods Sold?

There is no difference between variable-costing operating income and absorption-costing operating income if there is no ________.

The two key items in determining the budgeted factory overhead application rate are total budgeted factory overhead costs and ________.

There is no production volume variance when expected production volume equals actual production volume.

No one cost driver is appropriate for all situations.

White Company had the following information: Assume the cost driver for factory overhead costs is direct labor hours.What amount of factory overhead is applied to the products produced?

Most companies consider production volume variances to be beyond a manager's immediate control.

The variable-costing method does not include fixed overhead costs in a product's costs.

Why do companies use variable costing for internal financial statements?

When the number of units sold exceeds the number of units produced,net income under variable costing ________ net income under absorption costing.

Stars Company reported the following information about the production and sale of its only product during the first month of operations: Under absorption costing,what is the product cost per unit?

The most widely used approach in disposing of an overhead variance is proration to the affected accounts.

When calculating the budgeted overhead rate,the numerator of the fraction is the actual amount of the cost driver.

To apply the budgeted overhead costs to a job,the budgeted overhead rate is multiplied by the ________.

The production volume variance is the difference between ________.

Gross margin is a subtotal on a variable-costing income statement.

Schmidt Company reported the following information about the production and sale of its only product during the first month of operations: Under variable costing,what is the product cost per unit?

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Job-Order Costing and Process-Costing Systems

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

Exam 13: Accounting for Overhead Costs

Variable costing considers fixed manufacturing overhead costs as a(n)________.

Couric Company reported the following information about the production and sale of its only product during the first month of operations: Under absorption costing,what is the Cost of Goods Sold?

There is no difference between variable-costing operating income and absorption-costing operating income if there is no ________.

The two key items in determining the budgeted factory overhead application rate are total budgeted factory overhead costs and ________.

There is no production volume variance when expected production volume equals actual production volume.

No one cost driver is appropriate for all situations.

White Company had the following information: Assume the cost driver for factory overhead costs is direct labor hours.What amount of factory overhead is applied to the products produced?

Most companies consider production volume variances to be beyond a manager's immediate control.

The variable-costing method does not include fixed overhead costs in a product's costs.

Why do companies use variable costing for internal financial statements?

When the number of units sold exceeds the number of units produced,net income under variable costing ________ net income under absorption costing.

Stars Company reported the following information about the production and sale of its only product during the first month of operations: Under absorption costing,what is the product cost per unit?

The most widely used approach in disposing of an overhead variance is proration to the affected accounts.

When calculating the budgeted overhead rate,the numerator of the fraction is the actual amount of the cost driver.

To apply the budgeted overhead costs to a job,the budgeted overhead rate is multiplied by the ________.

The production volume variance is the difference between ________.

Gross margin is a subtotal on a variable-costing income statement.

Schmidt Company reported the following information about the production and sale of its only product during the first month of operations: Under variable costing,what is the product cost per unit?

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Job-Order Costing and Process-Costing Systems

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters