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Exam 21: Flexible Budgets and Standard Costs

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Question 81

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The fixed overhead variance can be broken down into the ________ variance and the ________ variance.

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verified

spending; ...

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Question 82

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The sum of the variable overhead spending variance,the variable overhead efficiency variance,the fixed overhead spending variance is the ________.

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controllab...

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Question 83

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Presented below are terms preceded by letters a through h and followed by a list of definitions 1 through 8.Enter the letter of the term with the definition,using the space preceding the definition. (a)Unfavorable variance (b)Fixed budget performance report (c)Overhead cost variance (d)Efficiency variance (e)Spending variance (f)Flexible budget performance report (g)Quantity variance (h)Favorable variance ________(1)Results from a comparison of actual cost or revenue to budget that contributes to a lower income. ________(2)A report that compares actual results with the results expected under a fixed budget. ________(3)When management pays an amount different from the standard price to acquire an item. ________(4)Results from a comparison of actual cost or revenue to budget that contributes to higher income. ________(5)Difference in variable overhead when the standard allocation base expected for actual production differs from the actual allocation base. ________(6)Difference between actual quantity of an input and the standard quantity of the input. ________(7)Difference between the total overhead cost applied to products and the total overhead cost actually incurred. ________(8)A report that compares actual performance and budgeted performance based on actual sales volume or other activity level.

An internal report that helps management analyze the difference between actual performance and budgeted performance based on the actual sales volume (or other level of activity) is called a(n) :

Management by exception means studying industry standards to define normal conditions.

When the actual price per unit of direct materials used exceeds the standard price per unit,the company has an unfavorable direct materials price variance.

The difference between actual quantity of input used and the standard quantity of input used results in a:

The difference between the flexible budget sales and the fixed budget sales is called the ________ variance.

Naches Co.assigned direct labor cost to its products in May for 1,300 standard hours of direct labor at the standard $8 per hour rate.The direct labor rate variance for the month was $200 favorable and the direct labor efficiency variance was $150 favorable.Prepare the journal entry to charge Work in Process Inventory for the standard labor cost of the goods manufactured in May and to record the direct labor variances.Assuming that the direct labor variances are immaterial,prepare the journal entry that Naches would make to close the variance accounts.

Ship Co.produces storage crates that require 1.2 meters of material at $.85 per meter and 0.1 direct labor hours at $15.00 per hour.Overhead is applied at the rate of $9 per direct labor hour.What is the total standard cost for one unit of product that would appear on a standard cost card?

Based on predicted production of 12,000 units,a company anticipates $150,000 of fixed costs and $123,000 of variable costs.The flexible budget amounts of fixed and variable costs for 10,000 units are:

A company's flexible budget for the range of 35,000 units to 45,000 units of production showed variable overhead costs of $2 per unit and fixed overhead costs of $72,000.The company incurred total overhead costs of $148,800 while operating at a volume of 40,000 units.The total controllable cost variance is:

Oxford Co.produces and sells two lines of t-shirts,Classic and Mod.Oxford provides the following data.Compute the sales price and the sales volume variances for each product.

Based on a predicted level of production and sales of 30,000 units,a company anticipates total contribution margin of $105,000,fixed costs of $40,000,and operating income of $65,000.Based on this information,the budgeted operating income for 28,000 units would be:

What are some causes of direct labor rate and efficiency variances?

Lavoie Company planned to use 18,500 pounds of material costing $2.50 per pound to make 4,000 units of its product.In actually making 4,000 units,the company used 18,800 pounds that cost $2.54 per pound.Calculate the direct materials quantity variance.

Fletcher Company collected the following data regarding production of one of its products. -Compute the direct materials price variance.

A fixed budget is based on a single predicted amount of sales or other activity measure.

If Mercury Company's actual overhead incurred during a period was $32,700 and the company reported a favorable overhead controllable variance of $1,200 and an unfavorable overhead volume variance of $900,how much standard overhead cost was assigned to the products produced during the period?

When standard costs are used,factory overhead is assigned to products with a predetermined standard overhead rate.