Exam 11: Standard Costs for Control: Flexible Budgets and Manufacturing Overhead

The following table provides information about a company's production.If variable costs increased in 2005 by 10 per cent and fixed overheads increased in 2006 by 20 per cent,what was the estimated total cost in 2006?

Felter Company sold 8000 units of Product X last month.The actual production level was 9000 units.The budget selling price was $10,but the sales manager had to discount the products by 20 per cent before managing to sell these units.The sales price variance is:

A particular company incurs actual overhead of $10 per unit produced.The company's budgeted (standard)overhead cost per unit produced is $9 per unit.Overhead is applied based on machine hours.If the company's actual machine hours worked was 1000,and standard hours allowed for units produced in the period was 1100 hours,what amount would be debited to work in process for overhead if the company used actual costing,normal costing and standard costing respectively?

Which of the following formulas is the relationship between activity and total budgeted overhead cost is represented by?

ABB works in the reverse way to ABC as under ABB,once the sales volume and production volume have been estimated then the demand for activities can be determined.

One of the main criticisms of standard costing systems is that it tends to focus too heavily on cost minimisation.

A four-way overhead analysis involves calculating variances for variable overheads,spending and efficiency,fixed overhead budget and fixed overhead volume.

Which of the following is used in the computation of the variable overhead spending variance? Actual variable Factory overhead Flexible budget based On standard hours Standard variable Overhead rate

The activity measure for overhead allocation should be one:

Which of the following interpretations of an unfavourable fixed overhead volume variance is correct?

Star Company is preparing a flexible budget for 2008 and the following maximum capacity estimates for department Z are: Assume that Star's normal capacity is 80 per cent of maximum capacity.What would be the total factory overhead rate per direct labour hour in a flexible budget at normal capacity?

A flexible budget is prepared for an expected level of activity.

Which of the following is used in the calculation of the variable overhead spending variance? Flexible budget based on standard hours allowed Standard variable overhead applied to production Flexible budget based on actual hours

Master Products has the following information at the end of the year.What is Master Product's sales volume variance?

The sales price variance equals:

When does budgeted fixed overhead differ from applied fixed overhead? (Assume the number of machine hours is the activity base. )

A flexible budget for Heath Company for 5 000 hours is shown below: What are the total overhead costs for 10 000 hours?