Question 1

The static-budget variance is the difference between ________.

Accepted Answer

A)  an actual result and the corresponding budgeted amount in the static budget 
B)  the budget amount in the static budget and the amount in the flexible budget 
C)  an actual result and the flexible budget amount 
D)  the static budget amount and the sales-volume variance 
A)  an actual result and the corresponding budgeted amount in the static budget 
B)  the budget amount in the static budget and the amount in the flexible budget 
C)  an actual result and the flexible budget amount 
D)  the static budget amount and the sales-volume variance

Question 2

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows:
 
What is the total sales-volume variance in terms of the contribution margin?

Accepted Answer

A)  $1,924,000 favorable 
B)  $1,404,000 favorable 
C)  $5,200,000 unfavorable 
D)  $1,924,000 unfavorable 
A)  $1,924,000 favorable 
B)  $1,404,000 favorable 
C)  $5,200,000 unfavorable 
D)  $1,924,000 unfavorable

Question 3

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows:
 
What is the total static-budget variance in terms of the contribution margin?

Accepted Answer

A)  $680,000 favorable 
B)  $1,320,000 favorable 
C)  $1,320,000 unfavorable 
D)  $680,000 unfavorable 
A)  $680,000 favorable 
B)  $1,320,000 favorable 
C)  $1,320,000 unfavorable 
D)  $680,000 unfavorable

Question 4

Which of the following customer related costs are NOT economically feasible to trace but are related to a customer?

Accepted Answer

A)  the additional cost of selling one more unit to a new customer who has never done business with the firm before 
B)  the direct material costs of a product that a customer has purchased 
C)  the allocation of the cost of travel, lodgings, and meals that result from visiting customers at their locations 
D)  the shipping costs that result from shipping a package by Fed Ex to a customer when the technology allows a direct match of that cost to the direct material and direct labor costs of the product 
A)  the additional cost of selling one more unit to a new customer who has never done business with the firm before 
B)  the direct material costs of a product that a customer has purchased 
C)  the allocation of the cost of travel, lodgings, and meals that result from visiting customers at their locations 
D)  the shipping costs that result from shipping a package by Fed Ex to a customer when the technology allows a direct match of that cost to the direct material and direct labor costs of the product

Question 5

The Corata Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products:
 
What is the total sales-volume variance in terms of the contribution margin?

Accepted Answer

A)  $674,000 unfavorable 
B)  $502,000 favorable 
C)  $588,000 unfavorable 
D)  $674,000 favorable 
A)  $674,000 unfavorable 
B)  $502,000 favorable 
C)  $588,000 unfavorable 
D)  $674,000 favorable

Question 6

Capity Tea Products has an exclusive contract with British Distributors. Calamine and Capity are two brands of teas that are imported and sold to retail outlets. The following information is provided for the month of March:
 
Budgeted and actual fixed corporate-sustaining costs are $1,850 and $2,300, respectively. What is the contribution margin for the flexible budget?

Accepted Answer

A)  $8961 
B)  $9855 
C)  $9266 
D)  $10,811 
A)  $8961 
B)  $9855 
C)  $9266 
D)  $10,811

Question 7

If a cost pool is homogeneous, the cost allocations using that pool will be the same as they would be if costs of each individual activity in that pool were allocated separately.

Accepted Answer

A) True 
 B)False

Question 8

Today, companies are simplifying their cost systems and moving toward less-detailed and less-complex cost allocation bases.

Accepted Answer

A) True 
 B)False

Question 9

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows:
 
What is the contribution margin for the flexible budget? (Round intermediary calculations to the nearest dollar.)

Accepted Answer

A)  $1,360,800 
B)  $4,368,000 
C)  $4,698,400 
D)  $5,728,800 
A)  $1,360,800 
B)  $4,368,000 
C)  $4,698,400 
D)  $5,728,800

Question 10

Advances in information-gathering technology make it more likely that multiple cost-pool systems will pass the cost-benefit test.

Accepted Answer

A) True 
 B)False

Question 11

It is possible that the smallest customer in terms of revenue is the most profitable customer.

Accepted Answer

A) True 
 B)False

Question 12

Which purpose of cost allocation is used to encourage sales representatives to push high-margin products or services?

Accepted Answer

A)  to provide information for economic decisions 
B)  to motivate managers and other employees 
C)  to justify costs or compute reimbursement 
D)  to measure income and assets for reporting to external parties 
A)  to provide information for economic decisions 
B)  to motivate managers and other employees 
C)  to justify costs or compute reimbursement 
D)  to measure income and assets for reporting to external parties

Question 13

Woodruff Flowering Plants provides the following information for the month of May:
 
What is the budgeted contribution margin per composite unit for the budgeted mix? (Round any intermediary calculations two decimal places.)

Accepted Answer

A)  $22.79 
B)  $22.21 
C)  $21.96 
D)  $22.04 
A)  $22.79 
B)  $22.21 
C)  $21.96 
D)  $22.04

Question 14

Price discounts are influenced by ________.

Accepted Answer

A)  the volume of product purchased 
B)  the prime cost of production 
C)  the operational budget 
D)  the contribution -margin per unit 
A)  the volume of product purchased 
B)  the prime cost of production 
C)  the operational budget 
D)  the contribution -margin per unit

Question 15

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows:
 
What is the total flexible-budget variance in terms of the contribution margin? (Round intermediary calculations to the nearest dollar.)

Accepted Answer

A)  $340,800 favorable 
B)  $1,356,800 favorable 
C)  $340,800 unfavorable 
D)  $4,514,000 unfavorable 
A)  $340,800 favorable 
B)  $1,356,800 favorable 
C)  $340,800 unfavorable 
D)  $4,514,000 unfavorable

Question 16

While allocating corporate costs to divisions ________.

Accepted Answer

A)  only fixed costs should be allocated 
B)  no homogeneous cost pools should be constructed 
C)  all the costs in the cost pool should not have the same or a similar cause-and-effect or benefits-received relationship with the cost-allocation base 
D)  allocate both variable and fixed costs to divisions and then to customers 
A)  only fixed costs should be allocated 
B)  no homogeneous cost pools should be constructed 
C)  all the costs in the cost pool should not have the same or a similar cause-and-effect or benefits-received relationship with the cost-allocation base 
D)  allocate both variable and fixed costs to divisions and then to customers

Question 17

The Octova Corporation manufactures two types of vacuum cleaners: the ZENITH for commercial building use and the House-Helper for residences. Budgeted and actual operating data for the year 2017 are as follows:
   
Required:
a.Calculate the contribution margin for the flexible budget.
b.Determine the total static-budget variance, the total flexible-budget variance, and the total sales-volume variance in terms of the contribution margin.

Accepted Answer

The answer of The Octova Corporation manufactures two types of...

Question 18

Which of the following is a corporate-sustaining cost?

Accepted Answer

A)  design costs 
B)  corporate brand advertising 
C)  shipment costs 
D)  research and development costs 
A)  design costs 
B)  corporate brand advertising 
C)  shipment costs 
D)  research and development costs

Question 19

Capity Tea Products has an exclusive contract with British Distributors. Calamine and Capity are two brands of teas that are imported and sold to retail outlets. The following information is provided for the month of March:
 
Budgeted and actual fixed corporate-sustaining costs are $1,850 and $2,300, respectively.
For the contribution margin, what is the total static-budget variance?

Accepted Answer

A)  $6930 favorable 
B)  $364 unfavorable 
C)  $70 favorable 
D)  $364 favorable 
A)  $6930 favorable 
B)  $364 unfavorable 
C)  $70 favorable 
D)  $364 favorable

Question 20

There is a direct cause-and effect relationship between division-sustaining costs and customer or sales manager's actions.

Accepted Answer

A) True 
 B)False

The static-budget variance is the difference between ________.

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows: What is the total sales-volume variance in terms of the contribution margin?

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows: What is the total static-budget variance in terms of the contribution margin?

Which of the following customer related costs are NOT economically feasible to trace but are related to a customer?

The Corata Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products: What is the total sales-volume variance in terms of the contribution margin?

If a cost pool is homogeneous, the cost allocations using that pool will be the same as they would be if costs of each individual activity in that pool were allocated separately.

Today, companies are simplifying their cost systems and moving toward less-detailed and less-complex cost allocation bases.

Advances in information-gathering technology make it more likely that multiple cost-pool systems will pass the cost-benefit test.

It is possible that the smallest customer in terms of revenue is the most profitable customer.

Which purpose of cost allocation is used to encourage sales representatives to push high-margin products or services?

Woodruff Flowering Plants provides the following information for the month of May: What is the budgeted contribution margin per composite unit for the budgeted mix? (Round any intermediary calculations two decimal places.)

Price discounts are influenced by ________.

While allocating corporate costs to divisions ________.

Which of the following is a corporate-sustaining cost?

There is a direct cause-and effect relationship between division-sustaining costs and customer or sales manager's actions.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters

Exam 14: Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

The static-budget variance is the difference between ________.

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows: What is the total sales-volume variance in terms of the contribution margin?

The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and the House-Mate for residences. Budgeted and actual operating data for the year 2017 were as follows: What is the total static-budget variance in terms of the contribution margin?

Which of the following customer related costs are NOT economically feasible to trace but are related to a customer?

The Corata Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products: What is the total sales-volume variance in terms of the contribution margin?

If a cost pool is homogeneous, the cost allocations using that pool will be the same as they would be if costs of each individual activity in that pool were allocated separately.

Today, companies are simplifying their cost systems and moving toward less-detailed and less-complex cost allocation bases.

Advances in information-gathering technology make it more likely that multiple cost-pool systems will pass the cost-benefit test.

It is possible that the smallest customer in terms of revenue is the most profitable customer.

Which purpose of cost allocation is used to encourage sales representatives to push high-margin products or services?

Woodruff Flowering Plants provides the following information for the month of May: What is the budgeted contribution margin per composite unit for the budgeted mix? (Round any intermediary calculations two decimal places.)

Price discounts are influenced by ________.

While allocating corporate costs to divisions ________.

Which of the following is a corporate-sustaining cost?

There is a direct cause-and effect relationship between division-sustaining costs and customer or sales manager's actions.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters