Exam 15: Operational Performance Measurement: Indirect-Cost Variances and Resource- Capacity Management

Which of the following is not a plausible cause of a systematic variance?

Which of the following statement is true regarding choice of the denominator volume level in conjunction with the process of allocating fixed manufacturing costs to production?

At the denominator activity level,Norland Company's total overhead budget for 25,000 units of production shows variable overhead costs of $36,000 and fixed overhead costs of $32,000.During the most recent period,the company incurred total overhead costs of $61,400 to manufacture 20,000 units.The total factory overhead variance is:

You are provided with the following summary of overhead-related costs for the most recent accounting period for a company that uses a single overhead account,Factory Overhead,into which it records both actual and standard overhead costs during the period:

The difference between total factory overhead cost incurred during a period and the total standard factory overhead cost assigned to production of the period is the ______________

You are provided with the following summary of overhead-related costs for the most recent accounting period:

In a standard cost system,when production is greater than the denominator volume level,there will be:

Oslund Company manufactures only one product and uses a standard cost system.During the past month,the following variances were observed: Oslund applies variable overhead using a standard rate of $20 per standard DLH allowed.During the month,Oslund used 20% more DLHs than the total standard hours for the units manufactured.What were the total actual direct hours worked?

Carl Jones Company's master budget for the year just completed was based on 100% capacity and included 50,000 machine hours and $300,000 total factory overhead.(That is,the denominator volume,for purposes of calculating the fixed overhead application rate,is defined as 100% capacity. )Budgeted fixed overhead at 70% factory capacity is $200,000 (and 35,000 machine hours).The company operated at 80% capacity for the year,and incurred $275,000 total factory overhead. Required: (a)Determine the factory overhead flexible-budget variance for the year just completed.Show calculations.(b)Calculate the factory overhead production-volume variance for the year just completed.Show calculations.(c)Supply an interpretation of each of the two variances calculated above.

In deciding whether to further investigate a variance,managers usually:

Neptune Inc.uses a standard cost system and has the following information for April: The total factory overhead flexible-budget variance is:

A deviation from standard because of the failure to include one or more relevant variables,or the inclusion of the wrong or irrelevant variables in the standard-setting process is an example of a(n):

The difference between the actual fixed overhead cost incurred during a period and the budgeted fixed overhead cost for the period is the:

Bonehead Co.has the following factory overhead costs: The total overhead flexible-budget (FB)variance is:

The difference between actual overhead costs incurred during the period and the overhead in the flexible budget based on the output for the period is called the:

The following information is available from Thinnews Co. ,a company that uses machine hours to apply factory overhead: The standard fixed overhead application rate is:

In terms of allocating fixed overhead cost to products,generally accepted accounting principles:

Air Inc.uses a standard cost system.Overhead cost information for Product CX10 for the month of October is as follows: What is the total overhead variance for October?

Which of the following is a characteristic of calculating standard cost variances for manufacturing overhead costs under an activity-based cost (ABC)system?

The following information is available from the Taro Company: What is the total overhead efficiency variance for the period?