Exam 9: Master Budgeting

Vanderhyde Kennel uses tenant-days as its measure of activity;an animal housed in the kennel for one day is counted as one tenant-day.During May,the kennel budgeted for 3,300 tenant-days,but its actual level of activity was 3,340 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: The administrative expenses in the planning budget for May would be closest to:

Cearns Memorial Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for December is to be based on 3,900 meals.The diner's director has provided the following cost formulas to use in the budget: Required: Prepare the diner's budget for the month of December.The budget will only contain the costs listed above;no revenues will be on the budget.

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

The following standards have been established for a raw material used to make product I92: The following data pertain to a recent month's operations: The direct materials purchases variance is computed when the materials are purchased. Required: a.What is the materials price variance for the month? b.What is the materials quantity variance for the month?

The revenue and spending variances are the differences between the flexible budget and the actual results for the period.

Suski Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs).The company has provided the following data for the most recent month: What was the variable overhead rate variance for the month?

Imrie Corporation makes a product that uses a material with the quantity standard of 9.5 grams per unit of output and the price standard of $5.00 per gram.In January the company produced 2,900 units using 26,940 grams of the direct material.During the month the company purchased 28,900 grams of the direct material at $4.90 per gram.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for January is:

Hien Inc. ,uses machine-hours as the base to apply its manufacturing overhead.The following information relates to variable manufacturing overhead standards at Hien: Standard rate per machine-hour: $50 Total standard machine-hours allowed for units produced during September: 4,000 Hien's variable overhead rate variance for September was $800 favorable.Its variable overhead efficiency variance was $3,600 unfavorable.How many machine-hours did Hien actually use during September?

Galla Corporation makes a product with the following standard costs: The company budgeted for production of 2,400 units in June,but actual production was 2,500 units.The company used 19,850 pounds of direct material and 980 direct labor-hours to produce this output.The company purchased 21,700 pounds of the direct material at $6.70 per pound.The actual direct labor rate was $19.20 per hour and the actual variable overhead rate was $1.80 per hour. 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 efficiency variance for June 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 materials price variance for June is:

Sizzle Company uses a standard cost system to collect costs related to the production of its "No-Stick" lawn chairs.The direct material for the chairs is teflon.Sizzle uses a standard direct material cost of $40.00 per chair (0.8 pounds of teflon × $50.00 per pound).During April,Sizzle purchased 2,100 pounds of teflon for $106,575.Sizzle used 1,750 pounds of this teflon in April to produce 1,800 lawn chairs. Required: Calculate Sizzle's materials price and materials quantity variances for April.

Hartz Urban Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for July was based on 3,100 meals.The diner's director has provided the following cost data to use in the budget: groceries,$2.50 per meal;kitchen operations,$4,700 per month plus $1.75 per meal;administrative expenses,$2,200 per month plus $0.85 per meal;and fundraising expenses,$1,700 per month.The director has also provided the diner's statement of actual expenses for the month: Required: Prepare a report showing the diner's spending variances for each of the expenses and for total expenses for July.Label each variance as favorable (F)or unfavorable (U).

The following data have been provided by Petri Corporation: Indirect labor and power are both elements of variable manufacturing overhead. The variable overhead rate variance for power is closest to:

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 efficiency variance for April is:

A materials price variance is unfavorable if the actual price exceeds the standard price.

Zike Corporation's static planning budget for October appears below.The company bases its budgets on machine-hours. In October,the actual number of machine-hours was 6,000,the actual supplies cost was $14,740,the actual power cost was $49,170,the actual salaries cost was $15,390,and the actual equipment depreciation was $63,670. The spending variance for supplies cost in the performance report for the month should be:

Which of the following would produce a materials price variance?

Fixed costs should be ignored when evaluating how well a manager has controlled costs.

Tulip Midwifery's cost formula for its wages and salaries is $2,420 per month plus $388 per birth.For the month of January,the company planned for activity of 119 births,but the actual level of activity was 123 births.The actual wages and salaries for the month was $50,540.The wages and salaries in the flexible budget for January would be closest to:

Juenemann Kennel uses tenant-days as its measure of activity;an animal housed in the kennel for one day is counted as one tenant-day.During December,the kennel budgeted for 3,800 tenant-days,but its actual level of activity was 3,770 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting: Actual results for December: The wages and salaries in the planning budget for December would be closest to: