FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 13: Budgeting and Standard Costs

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 91

Multiple Choice

Review LaterAdd Note

Review Later

Fixed factory overhead volume variance is the difference between:

A) the budgeted fixed overhead at 100% of normal capacity and the standard fixed overhead for the actual units produced.
B) the budgeted fixed overhead for actual units produced and the standard fixed overhead for the actual units produced.
C) the budgeted fixed overhead for actual units produced and the actual fixed overhead for the actual units produced.
D) the budgeted fixed overhead at 100% of normal capacity and the actual fixed overhead for the actual units produced.

E) All of the above
F) A) and B)

Correct Answer

verified

Show Answer

Question 92

Multiple Choice

Review LaterAdd Note

Review Later

The standard costs and actual costs for direct materials for the manufacture of 2,500 actual units of product are as follows: Standard Costs Direct materials (per completed unit) $\quad 1.04$ kilograms $@ \$ 8.75$ Actual Costs Direct materials $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ 2,500 kilograms $@ \$ 8$ ? The amount of direct materials price variance is:

A) $1,875 unfavorable.
B) $1,950 favorable.
C) $1,875 favorable.
D) $1,950 unfavorable.

E) A) and B)
F) B) and C)

Correct Answer

verified

Show Answer

Question 93

Multiple Choice

Review LaterAdd Note

It would be most appropriate to develop direct labor time standards for use in administrative activities when the activity involves:

The formula to compute direct material quantity variance is:

The standard factory overhead rate is $12 per machine hour ($10 for variable factory overhead and $2 for fixed factory overhead) based on 100% capacity of 42,000 machine hours.The standard cost and the actual cost of factory overhead for the production of 2,000 units were as follows: $\begin{array}{lr}\text { Actual: Variable factory overhead } & \$ 350,500 \\\text { Fixed factory overhead } & 84,000 \\\text { Standard: } 35,000 \text { hours } @ \$ 12 & 420,000\end{array}$ ? Determine the (a) volume variance, (b) controllable variance, and (c) total factory overhead cost variance.

Standard costs serve as a device for measuring efficiency.

Nonmanufacturing activities are usually controlled using a static budget rather than a standard costing system.

As of January 1 of the current year, the Butner Company had accounts receivables of $50,000.Sales for January, February, and March were as follows: $120,000, $140,000, and $150,000.20% of each month's sales are for cash.Of the remaining 80% (the credit sales) , 60% are collected in the month of sale, with the remaining 40% collected in the following month.What is the total cash collected (both from accounts receivable and for cash sales) in the month of February?

Which of the following processes is involved in budgeting?

A formal written statement of management's plans for the future, expressed in financial terms, is called a budget.

Prepare a monthly flexible selling expense budget for Podism Company for sales volumes of $270,000, $350,000, and $480,000, based on the following data: $\begin{array} { l l } \text { Sales commissions } & 7 \% \text { of sales } \\\text { Sales manager's salary } & \$ 62,000 \text { per month } \\\text { Advertising expense } & \$ 70,000 \text { per month } \\\text { Shipping expense } & 2 \% \text { of sales } \\\text { Miscellaneous selling expense } & \$ 2,500 \text { per month plus } 1 / 2 \% \text { of sales }\end{array}$

A _____ summarizes actual costs, standard costs, and the differences for the units produced.

Standard and actual costs for direct labor for the manufacture of 1,500 units of product were as follows: $\begin{array}{ll}\text { Actual costs } & 450 \text { hours } @ \$ 17.00 \\\text { Standard costs } & 455 \text { hours } @ \$ 16.50\end{array}$ ? Determine the (a) time variance, (b) rate variance, and (c) total direct labor cost variance.

The following data is given for the Walker Company: $\begin{array}{ll}\text { Budgeted production } & 1,000 \text { units } \\\text { Actual production } & 980 \text { units }\\\text { Materials: }\\\text { Standard price per lb } & \$ 2.00 \\\text { Standard pounds per completed unit } & 12 \\\text { Actual pounds purchased and used in production } & 11,800 \\\text { Actual price paid for materials } & \$ 23,000\\\text { Labor: }\\\text { Standard hourly labor rate } & \$ 14 \text { per hour } \\\text { Standard hours allowed per completed unit } & 4.5 \\\text { Actual labor hours worked } & 4,560 \\\text { Actual total labor costs } & \$ 62,928\\\text { Overhead: }\\\text { Actual and budgeted fixed overhead }&\$27,000\\\text { Standard variable overhead rate }&\$ 3.50 \text { per standard labor hour }\\\text { Actual variable overhead costs }&\$15,500\end{array}$ Overhead is applied on standard labor hours. ? The factory overhead volume variance is:

The standard cost is a detailed estimate of how much a product should cost.

Normally standard costs should be revised when labor rates change to incorporate new union contracts.

Once a static budget has been determined, it is changed regularly as the underlying activity changes.

The following data relate to direct labor costs for the current period of Executive Inc.: $\begin{array} { l l } \text { Standard costs } & 6,000 \text { hours at } \$ 12.00 \\\text { Actual costs } & 7,500 \text { hours at } \$ 11.60\end{array}$ ? What is the direct labor rate variance?