Exam 9: Master Budgeting

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The labor rate variance for April is:

Oddo Corporation makes a product with the following standard costs: The company reported the following results concerning this product in December. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for December is:

Sekuterski Air uses two measures of activity,flights and passengers,in the cost formulas in its budgets and performance reports.The cost formula for plane operating costs is $45,700 per month plus $2,892 per flight plus $4 per passenger.The company expected its activity in November to be 81 flights and 283 passengers,but the actual activity was 80 flights and 282 passengers.The actual cost for plane operating costs in November was $286,360.The plane operating costs in the flexible budget for November would be closest to:

Stitt Corporation manufactures and sells a single product.The company uses units as the measure of activity in its budgets and performance reports.During November,the company budgeted for 5,900 units,but its actual level of activity was 5,880 units.The company has provided the following data concerning the formulas used in its budgeting and its actual results for November: Data used in budgeting: Actual results for November: The spending variance for manufacturing overhead in November would be closest to:

The Swenson Corporation has a standard costing system.The following data are available for June: The actual price per pound of direct materials purchased in June is:

Pardoe Inc. ,manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours.The company uses a standard cost system and has established the following standards for one unit of product: During March,the following activity was recorded by the company: • The company produced 3,000 units during the month. • A total of 8,000 pounds of material were purchased at a cost of $23,000. • There was no beginning inventory of materials on hand to start the month;at the end of the month,2,000 pounds of material remained in the warehouse. • During March,1,600 direct labor-hours were worked at a rate of $6.50 per hour. • Variable manufacturing overhead costs during March totaled $1,800. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for March is:

Gilder Corporation makes a product with the following standard costs: The company reported the following results concerning this product in June. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The labor rate variance for June is:

Federick Clinic uses client-visits as its measure of activity.During October,the clinic budgeted for 3,000 client-visits,but its actual level of activity was 3,040 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for October: Data used in budgeting: Actual results for October: The spending variance for occupancy expenses in October would be closest to:

Larance Detailing's cost formula for its materials and supplies is $2,230 per month plus $1 per vehicle.For the month of November,the company planned for activity of 75 vehicles,but the actual level of activity was 25 vehicles.The actual materials and supplies for the month was $2,160. The materials and supplies in the flexible budget for November would be closest to:

Ruetz Clinic uses client-visits as its measure of activity.During November,the clinic budgeted for 2,500 client-visits,but its actual level of activity was 2,520 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting: The occupancy expenses in the flexible budget for November would be closest to:

The Hanson Corporation employs a standard costing system.The following data are available for February: The actual direct labor rate for February is:

Hettinger Hospital bases its budgets on patient-visits.The hospital's static budget for March appears below: The total variable cost at the activity level of 7,200 patient-visits per month should be:

Seekell Memorial Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for October was based on 2,500 meals,but the diner actually served 2,900 meals.The diner's director has provided the following cost formulas to use in budgets: Required: Prepare the diner's flexible budget for the actual number of meals served in October.The budget will only contain the costs listed above;no revenues will be on the budget.

Nicolaysen Corporation manufactures and sells a single product.The company uses units as the measure of activity in its budgets and performance reports.During February,the company budgeted for 5,700 units,but its actual level of activity was 5,690 units.The company has provided the following data concerning the formulas used in its budgeting and its actual results for February: Data used in budgeting: Actual results for February: The net operating income in the planning budget for February would be closest to:

Tout Corporation makes a product that has the following direct labor standards: The company budgeted for production of 6,400 units in October,but actual production was 6,500 units.The company used 610 direct labor-hours to produce this output.The actual direct labor rate was $21.80 per hour. The labor rate variance for October is:

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the materials quantity variance for the month?

Bronfenbrenner Co.uses a standard cost system for its single product in which variable overhead is applied on the basis of direct labor hours.The following information is given: Standard costs per unit: Actual experience for current year: Required: Compute the following variances for raw materials,direct labor,and variable overhead,assuming that the price variance for materials is recognized at point of purchase: a.Direct materials price variance. b.Direct materials quantity variance. c.Labor rate variance. d.Labor efficiency variance. e.Variable overhead rate variance. f.Variable overhead efficiency variance.

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost.Jackson has established the following standards for one unit of product. During May,Jackson purchased 125,000 pounds of direct material at a total cost of $475,000.The total factory wages for May were $364,000,90 percent of which were for direct labor.Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours. The materials quantity variance for May is:

Vath Corporation,which makes landing gears,has provided the following data for a recent month: Required: Determine the rate and efficiency variances for the variable overhead item supplies and indicate whether those variables are favorable or unfavorable.Show your work!

The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: What is the variable overhead rate variance for the month?