Exam 23: Flexible Budgets and Standard Cost Systems

A company is analyzing its month-end results by comparing it to both static and flexible budgets.During the month,the actual fixed costs were lower than the expected fixed costs as per the static budget.This difference results in a(n)________.

Complete the following table: Variance How is the variance calculated? How does the variance arise? Flexible budget Sales volume

An unfavorable flexible budget variance in operating income might be due to a(n)________.

Which department is usually responsible for a direct labor cost variance attributable to inexperienced workers on the assembly line?

Delicious Food Products is famous for its trail mix.The main ingredient of the trail mix is dried fruit,which Delicious purchases by the pound.In addition,the production requires a certain amount of direct labor.Delicious uses a standard cost system,and at the end of the first quarter,there was an unfavorable direct materials efficiency variance.Which of the following is a logical explanation for that variance?

What does a favorable direct materials cost variance indicate?

On a standard cost income statement,the variances with debit balances are shown in parentheses because they are contra expenses and therefore decrease the expense Cost of Goods Sold.

The static budget,at the beginning of the month,for Beacon Banner Company follows: Static budget: Sales volume: 1100 units; Sales price: $70.00 per unit Variable costs: $33.00 per unit; Fixed costs: $37,800 per month Operating income: $2900 Actual results,at the end of the month,follows: Actual results: Sales volume: 995 units; Sales price: $75.00 per unit Variable costs: $35.00 per unit; Fixed costs: $35,000 per month Operating income: $4800 Calculate the sales volume variance for revenue.

A company is analyzing its month-end results by comparing it to both static and flexible budgets.During the month,the actual variable costs per unit were lower than the expected variable costs per unit as per the static budget.This difference results in a(n)________.

Accurate Tax Returns budgets two direct labor hours for every tax return that it prepares,at a standard cost of $34 an hour.During the most recent year,520 returns were completed with the labor cost totaling $18,000.The actual labor cost was $34.62 per hour during that period.The actual number of labor hours was 1200.What is the direct labor cost variance?

Based on the following,what is the total manufacturing overhead variance for the total product cost flexible budget variance?

Stafford Company uses standard costs for its manufacturing division.Standards specify 0.1 direct labor hours per unit of product.The allocation base for variable overhead costs is direct labor hours.At the beginning of the year,the static budget for variable overhead costs included the following data: Production volume 5000 units Budgeted variable overhead costs \ 13,500 Budgeted direct labor hours 610 hours At the end of the year,actual data were as follows: Production volume 4100 units Actual variable overhead costs \ 15,200 Actual direct labor hours 505 hours How much is the standard cost per direct labor hour for variable overhead? (Round your answer to the nearest cent.)

The total fixed overhead variance is the total of the variable overhead cost variance and fixed overhead volume variance.

Oceanside Marine Company manufactures special metallic materials and decorative fittings for luxury yachts that require highly skilled labor.Oceanside uses standard costs to prepare its flexible budget.For the first quarter of the year,direct materials and direct labor standards for one of their popular products were as follows: Direct materials: 2 pound per unit; $12 per pound Direct labor: 2 hours per unit; $16 per hour Oceanside produced 3000 units during the quarter.At the end of the quarter,an examination of the direct materials records showed that the company used 6500 pounds of direct materials and actual total materials costs were $99,600. What is the direct materials cost variance? (Round any intermediate calculations to the nearest cent,and your final answer to the nearest dollar.)

Based on the following,what is the total fixed overhead variance for the total product cost flexible budget variance?

The Crockery Pottery Company completed the flexible budget analysis for the second quarter,which is given below. Which of the following would be a correct factor to explain the sales volume variance for sales revenue?

Standard costs are developed by the cooperative effort of purchasing,production,human resources,and accounting personnel.

A standard cost system is an accounting system that uses standards for product costs.

The sales volume variance is a result of the difference between the actual sales price and the budgeted sales price.

What does the variable overhead cost variance measure?