Answer the following questions using the information below: PlasticsRus Pty Ltd manufactured 100 000 buckets during February.The overhead cost-allocation base is $5.00 per machine-hour.The following variable overhead data pertain to February: \[\begin{array} { l r r } & \text { Actual } & \text { Budgeted } \\ \text { Production } & 100000 \text { units } & 100000 \text { units } \\ \text { Machine-hours } & 9800 \text { hours } & 10000 \text { hours } \\ \text { Variable overhead cost per machine-hour } & \$ 5.25 & \$ 5.00 \end{array}\] -What is the variable overhead efficiency variance?

A) $1000 favourable B) $1450 unfavourable C) $2450 unfavourable D) None of these answers are correct. A) $1000 favourable B) $1450 unfavourable C) $2450 unfavourable D) None of these answers are correct.

Jeremy's Golfball Manufacturing Company reported: To isolate these variances at the end of the accounting period,Jeremy would debit Fixed Manufacturing Overhead Allocated for: $\begin{array}{ll} \text { Actual fixed overhead } & \$ 500000 \\ \text { Fixed manufacturing overhead spending variance } & \$ 30000 \text { favourable } \\ \text { Fixed manufacturing production-volume variance } & \$ 20000 \text { unfavourable } \end{array}$

A) $480 000 B) $490 000 C) $500 000 D) $510 000 A) $480 000 B) $490 000 C) $500 000 D) $510 000

Answer the following questions using the information below: $\begin{array}{lrcc} &&\text { Production- }\\ \text { Variances }&\text { Spending }&\text { Efficiency }&\text { Volume }\\ \text { Variable manufacturing overhead } & \$ 4500 \mathrm{~F} & \$ 15000 \mathrm{U} & \text { (B) } \\ \text { Fixed manufacturing overhead } & \$ 10000 \mathrm{U} & (\mathrm{A}) & \$ 40000 \mathrm{U} \end{array}$ -In a 3-variance analysis,the spending variance should be:

A) $4500 F. B) $10 500 U. C) $5500 U. D) $10 000 U. A) $4500 F. B) $10 500 U. C) $5500 U. D) $10 000 U.

Answer the following questions using the information below: Hobart Corporation manufactured 20 000 heaters during November.The overhead cost-allocation base is $15.75 per machine-hour.The following variable overhead data pertain to November: \[\begin{array} { l r r } & \text { Actual } & \text { Budgeted } \\ \text { Production } & 20000 \text { units } & 22000 \text { units } \\ \text { Machine-hours } & 7875 \text { hours } & 9000 \text { hours } \\ \text { Variable overhead cost per machine-hour: } & \$ 15.50 & \$ 15.75 \end{array}\] -What is the actual variable overhead cost?

A) $122 063 B) $124 031 C) $125 000 D) $139 500 A) $122 063 B) $124 031 C) $125 000 D) $139 500

Answer the following questions using the information below: Alice Springs Corporation manufactures industrial-sized water coolers and uses budgeted machine-hours to allocate variable manufacturing overhead.The following information pertains to the company's manufacturing overhead data: \[\begin{array} { l r } \text { Budgeted output units } & 20000 \text { units } \\ \text { Budgeted machine-hours } & 6000 \text { hours } \\ \text { Budgeted variable manufacturing overhead costs for } 20000 \text { units } & \$ 161250 \\ & \\ \text { Actual output units produced } & 24000 \text { units } \\ \text { Actual machine-hours used } & 7200 \text { hours } \\ \text { Actual variable manufacturing overhead costs } & \$ 242000 \end{array}\] -What is the flexible-budget amount for variable manufacturing overhead?

A) $165 000 B) $193 500 C) $242 000 D) None of these answers are correct. A) $165 000 B) $193 500 C) $242 000 D) None of these answers are correct.

Answer the following questions using the information below: Healesville Animal Products manufactured 32 000 horse grooming kits during 2018.The fixed-overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to 2018: \[\begin{array} { l r r } & \text { Actual } & \text { Static Budget } \\ \text { Production } & 32000 \text { units } & 30000 \text { units } \\ \text { Machine-hours } & 6100 \text { hours } & 6000 \text { hours } \\ \text { Fixed overhead costs for } 2018 & \$ 123000 & \$ 120000 \end{array}\] -What is the flexible-budget amount?

A) $120 000 B) $122 000 C) $123 000 D) $125 000 A) $120 000 B) $122 000 C) $123 000 D) $125 000

Answer the following questions using the information below: Norman & Appleby Corporation manufactured 15 000 golf bags during March.The fixed overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to March: \[\begin{array} { l r r } & \text { Actual } & \text { Static Budget } \\ \text { Production } & 15000 \text { units } & 18000 \text { units } \\ \text { Machine-hours } & 7650 \text { hours } & 9000 \text { hours } \\ \text { Fixed overhead cost for March } & \$ 122000 & \$ 120000 \end{array}\] -What is the flexible-budget amount?

A) $100 000 B) $102 000 C) $120 000 D) $122 000 A) $100 000 B) $102 000 C) $120 000 D) $122 000

Answer the following questions using the information below: Chappell Brothers Corporation manufactures promotional cricket hoodies and uses budgeted machine-hours to allocate variable manufacturing overhead.The following information pertains to the company's manufacturing overhead data: \[\begin{array} { l r } \text { Budgeted output units } & 25000 \text { units } \\ \text { Budgeted machine-hours } & 30000 \text { hours } \\ \text { Budgeted variable manufacturing overhead costs for } 25000 \text { units } & \$ 360000 \\ & \\ \text { Actual output units produced } & 20000 \text { units } \\ \text { Actual machine-hours used } & 28000 \text { hours } \\ \text { Actual variable manufacturing overhead costs } & \$ 342000 \end{array}\] -What is the flexible-budget amount for variable manufacturing overhead?

A) $288 000 B) $342 000 C) $380 000 D) None of these answers are correct. A) $288 000 B) $342 000 C) $380 000 D) None of these answers are correct.

Brandon's Basketball Manufacturing Company reported: $\begin{array}{ll} \text { Actual fixed overhead } & \$ 1000000 \\ \text { Fixed manufacturing overhead spending variance } & \$ 60000 \text { unfavourable } \\ \text { Fixed manufacturing production-volume variance } & \$ 40000 \text { unfavourable } \end{array}$ To isolate these variances at the end of the accounting period,Brandon would:

A) debit Fixed Manufacturing Overhead Spending Variance for $60 000. B) credit Fixed Manufacturing Control Allocated for $900 000. C) credit Fixed Manufacturing Production-Volume Variance for $40 000. D) debit Fixed Manufacturing Overhead Allocated for $1 000 000. A) debit Fixed Manufacturing Overhead Spending Variance for $60 000. B) credit Fixed Manufacturing Control Allocated for $900 000. C) credit Fixed Manufacturing Production-Volume Variance for $40 000. D) debit Fixed Manufacturing Overhead Allocated for $1 000 000.

Answer the following questions using the information below: Norman & Appleby Corporation manufactured 15 000 golf bags during March.The fixed overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to March: \[\begin{array} { l r r } & \text { Actual } & \text { Static Budget } \\ \text { Production } & 15000 \text { units } & 18000 \text { units } \\ \text { Machine-hours } & 7650 \text { hours } & 9000 \text { hours } \\ \text { Fixed overhead cost for March } & \$ 122000 & \$ 120000 \end{array}\] -What is the amount of fixed overhead allocated to production?

A) $150 000 B) $153 000 C) $120 000 D) $122 000 A) $150 000 B) $153 000 C) $120 000 D) $122 000

Answer the following questions using the information below: Patel Corporation manufactured 1000 coolers during October.The following variable overhead data pertain to October: $\begin{array}{ll} \text { Budgeted variable overhead cost per unit } & \$ 9.00 \\ \text { Actual variable manufacturing overhead cost } & \$ 8400 \\ \text { Flexible-bud get amount for variable manufacturing overhead } & \$ 9000 \\ \text { Variable manufacturing overhead efficiency variance } & \$ 180 \text { unfavourable } \end{array}$ -What is the variable overhead spending variance?

A) $420 unfavourable B) $600 unfavourable C) $600 favourable D) $780 favourable A) $420 unfavourable B) $600 unfavourable C) $600 favourable D) $780 favourable

Exam 13: Flexible Budgets, Overhead Cost Variances and Management Control

At the start of a budget period,management will have made most of the decisions that determine the level of ________________ to be incurred.

(Multiple Choice)

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(69)

Question 41

Answer the following questions using the information below: PlasticsRus Pty Ltd manufactured 100 000 buckets during February.The overhead cost-allocation base is $5.00 per machine-hour.The following variable overhead data pertain to February: Actual Budgeted Production 100000 units 100000 units Machine-hours 9800 hours 10000 hours Variable overhead cost per machine-hour \ 5.25 \ 5.00 -What is the variable overhead efficiency variance?

(Multiple Choice)

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(73)

Question 42

Jeremy's Golfball Manufacturing Company reported: To isolate these variances at the end of the accounting period,Jeremy would debit Fixed Manufacturing Overhead Allocated for: Actual fixed overhead \ 500000 Fixed manufacturing overhead spending variance \ 30000 favourable Fixed manufacturing production-volume variance \ 20000 unfavourable

(Multiple Choice)

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Question 43

Answer the following questions using the information below: Production- Variances Spending Efficiency Volume Variable manufacturing overhead \ 4500 \ 15000 (B) Fixed manufacturing overhead \ 10000 () \ 40000 -In a 3-variance analysis,the spending variance should be:

(Multiple Choice)

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Question 44

Answer the following questions using the information below: Hobart Corporation manufactured 20 000 heaters during November.The overhead cost-allocation base is $15.75 per machine-hour.The following variable overhead data pertain to November: Actual Budgeted Production 20000 units 22000 units Machine-hours 7875 hours 9000 hours Variable overhead cost per machine-hour: \ 15.50 \ 15.75 -What is the actual variable overhead cost?

(Multiple Choice)

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Question 45

Managers can reduce fixed overhead costs by,say,selling equipment or laying off employees.

(True/False)

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Question 46

Answer the following questions using the information below: OzPlastic Co.produces a special line of plastic toy racing cars.OzPlastic produces the cars in batches.To manufacture a batch of the cars,OzPlastic must set up the machines and moulds.Set-up costs are batch-level costs because they are associated with batches rather than individual units of products.A separate Set-up Department is responsible for setting up machines and moulds for different styles of car. Set-up overhead costs consist of some costs that are variable and some costs that are fixed with respect to the number of set-up-hours.The following information pertains to June 2018: Actual Static-budget Amounts Amounts Units produced and sold 30000 22500 Batch size (number of units per batch) 250 225 Set-up-hours per batch 5 5.25 Variable overhead cost per set-up-hour \ 40 \ 38 Total fixed setup overhead costs \ 14400 \ 14000 -Calculate the spending variance for variable set-up overhead costs.

(Multiple Choice)

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Question 47

Answer the following questions using the information below: Alice Springs Corporation manufactures industrial-sized water coolers and uses budgeted machine-hours to allocate variable manufacturing overhead.The following information pertains to the company's manufacturing overhead data: Budgeted output units 20000 units Budgeted machine-hours 6000 hours Budgeted variable manufacturing overhead costs for 20000 units \ 161250 Actual output units produced 24000 units Actual machine-hours used 7200 hours Actual variable manufacturing overhead costs \ 242000 -What is the flexible-budget amount for variable manufacturing overhead?

(Multiple Choice)

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Question 48

Answer the following questions using the information below: Healesville Animal Products manufactured 32 000 horse grooming kits during 2018.The fixed-overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to 2018: Actual Static Budget Production 32000 units 30000 units Machine-hours 6100 hours 6000 hours Fixed overhead costs for 2018 \ 123000 \ 120000 -What is the flexible-budget amount?

(Multiple Choice)

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Question 49

Answer the following questions using the information below: Norman & Appleby Corporation manufactured 15 000 golf bags during March.The fixed overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to March: Actual Static Budget Production 15000 units 18000 units Machine-hours 7650 hours 9000 hours Fixed overhead cost for March \ 122000 \ 120000 -What is the flexible-budget amount?

(Multiple Choice)

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Question 50

Fixed costs are unaffected by changes in the output level within the relevant range.

(True/False)

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Question 51

The variable overhead flexible-budget variance measures the difference between standard variable overhead costs and flexible-budget variable overhead costs.

(True/False)

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Question 52

Answer the following questions using the information below: Chappell Brothers Corporation manufactures promotional cricket hoodies and uses budgeted machine-hours to allocate variable manufacturing overhead.The following information pertains to the company's manufacturing overhead data: Budgeted output units 25000 units Budgeted machine-hours 30000 hours Budgeted variable manufacturing overhead costs for 25000 units \ 360000 Actual output units produced 20000 units Actual machine-hours used 28000 hours Actual variable manufacturing overhead costs \ 342000 -What is the flexible-budget amount for variable manufacturing overhead?

(Multiple Choice)

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Question 53

An unfavourable production-volume variance of $40 000 indicates that the company has:

(Multiple Choice)

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Question 54

Managers should use unitised fixed manufacturing overhead costs for planning and control.

(True/False)

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Question 55

Brandon's Basketball Manufacturing Company reported: Actual fixed overhead \ 1000000 Fixed manufacturing overhead spending variance \ 60000 unfavourable Fixed manufacturing production-volume variance \ 40000 unfavourable To isolate these variances at the end of the accounting period,Brandon would:

(Multiple Choice)

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Question 56

Answer the following questions using the information below: Norman & Appleby Corporation manufactured 15 000 golf bags during March.The fixed overhead cost-allocation rate is $20.00 per machine-hour.The following fixed overhead data pertain to March: Actual Static Budget Production 15000 units 18000 units Machine-hours 7650 hours 9000 hours Fixed overhead cost for March \ 122000 \ 120000 -What is the amount of fixed overhead allocated to production?

(Multiple Choice)

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(84)

Question 57

Answer the following questions using the information below: OzPlastic Co.produces a special line of plastic toy racing cars.OzPlastic produces the cars in batches.To manufacture a batch of the cars,OzPlastic must set up the machines and moulds.Set-up costs are batch-level costs because they are associated with batches rather than individual units of products.A separate Set-up Department is responsible for setting up machines and moulds for different styles of car. Set-up overhead costs consist of some costs that are variable and some costs that are fixed with respect to the number of set-up-hours.The following information pertains to June 2018: Actual Static-budget Amounts Amounts Units produced and sold 30000 22500 Batch size (number of units per batch) 250 225 Set-up-hours per batch 5 5.25 Variable overhead cost per set-up-hour \ 40 \ 38 Total fixed setup overhead costs \ 14400 \ 14000 -Calculate the efficiency variance for variable set-up overhead costs.

(Multiple Choice)

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Question 58

Answer the following questions using the information below: Patel Corporation manufactured 1000 coolers during October.The following variable overhead data pertain to October: Budgeted variable overhead cost per unit \ 9.00 Actual variable manufacturing overhead cost \ 8400 Flexible-bud get amount for variable manufacturing overhead \ 9000 Variable manufacturing overhead efficiency variance \ 180 unfavourable -What is the variable overhead spending variance?

(Multiple Choice)

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Question 59

When machine-hours are used as an overhead cost-allocation base and the unexpected purchase of a new machine results in fewer expenditures for machine maintenance,the MOST likely result would be to report a(n):

(Multiple Choice)

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Question 60

At the start of a budget period,management will have made most of the decisions that determine the level of ________________ to be incurred.

Answer the following questions using the information below: Production- Variances Spending Efficiency Volume Variable manufacturing overhead \ 4500 \ 15000 (B) Fixed manufacturing overhead \ 10000 () \ 40000 -In a 3-variance analysis,the spending variance should be:

Managers can reduce fixed overhead costs by,say,selling equipment or laying off employees.

Fixed costs are unaffected by changes in the output level within the relevant range.

The variable overhead flexible-budget variance measures the difference between standard variable overhead costs and flexible-budget variable overhead costs.

An unfavourable production-volume variance of $40 000 indicates that the company has:

Managers should use unitised fixed manufacturing overhead costs for planning and control.

Brandon's Basketball Manufacturing Company reported: Actual fixed overhead \ 1000000 Fixed manufacturing overhead spending variance \ 60000 unfavourable Fixed manufacturing production-volume variance \ 40000 unfavourable To isolate these variances at the end of the accounting period,Brandon would:

When machine-hours are used as an overhead cost-allocation base and the unexpected purchase of a new machine results in fewer expenditures for machine maintenance,the MOST likely result would be to report a(n):

Management Accounting in Context

Different Costs for Different Purposes

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Cost of Producing Services

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Budgeting, Management Control and Responsibility Accounting

Flexible Budgets, Direct Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

Inventory Management, Just-In-Time and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing and Multinational Considerations

Performance Measurement, Compensation and Multinational Considerations

Measuring and Reporting Sustainability

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