Question 1

Effective planning of variable overhead costs means that a company performs those variable overhead costs that primarily add value

Accepted Answer

A) for the current shareholders. 
B) for the customer using the products or services. 
C) for plant employees. 
D) for major suppliers of component parts. 
E) for management. 
A) for the current shareholders. 
B) for the customer using the products or services. 
C) for plant employees. 
D) for major suppliers of component parts. 
E) for management.

Question 2

If budgeted machine-hours allowed per actual output unit equals 1.0 hour, and budgeted variable manufacturing overhead per machine-hour is $200, what is the budgeted variable manufacturing overhead rate per output unit?

Accepted Answer

A) $100 
B) $200 
C) $300 
D) $400 
E) $500 
A) $100 
B) $200 
C) $300 
D) $400 
E) $500

Question 3

Answer the following question(s)using the information below.Cakewalk Ltd.delivers shoes in batches.The following information pertains to shipping dance shoes in June:
  
-What is the Cakewalk Ltd.efficiency variance for variable shipping overhead costs?

Accepted Answer

A) $864 F 
B) $464 F 
C) $560 F 
D) $864 U 
E) $464 U 
A) $864 F 
B) $464 F 
C) $560 F 
D) $864 U 
E) $464 U

Question 4

Actual overhead is $700,000, while budgeted overhead is $598,000.What is the fixed overhead static-budget variance if 250,000 units are produced and 225,000 are budgeted?

Accepted Answer

A) $80,000 favourable 
B) $100,000 unfavourable 
C) $100,000 favourable 
D) $102,000 unfavourable 
E) $102,000 favourable 
A) $80,000 favourable 
B) $100,000 unfavourable 
C) $100,000 favourable 
D) $102,000 unfavourable 
E) $102,000 favourable

Question 5

Casey Corporation produces a special line of basketball hoops in batches.To manufacture a batch of the basketball hoops Casey Corporation must setup the machines and moulds.Setup costs are batch-level costs because they are associated with batches rather than individual units of products.A separate Setup Department is responsible for setting up machines and moulds for different styles of basketball hoops.Setup overhead costs consist of some costs that are variable and some costs that are fixed with
respect to the number of setup hours.The following information pertains to January.   Required:
a.Calculate the efficiency variance for variable setup overhead costs.
b.Calculate the rate variance for variable setup overhead costs.
c.Calculate the flexible-budget variance for variable setup overhead costs.
d.Calculate the rate variance for fixed setup overhead costs.
e.Calculate the production-volume variance for fixed setup overhead costs.

Accepted Answer

a.((28,000/250)× 4 × $10)- ((28,000/200)

Question 6

Use the information below to answer the following question(s).Moeller Electric manufactures light fixtures.The following information pertains to the company's manufacturing overhead data.  
-What is Moeller Electric's variable manufacturing overhead static-budget variance?

Accepted Answer

A) $2,750 favourable 
B) $2,750 unfavourable 
C) $40,375 favourable 
D) $40,375 unfavourable 
E) $44,000 unfavourable 
A) $2,750 favourable 
B) $2,750 unfavourable 
C) $40,375 favourable 
D) $40,375 unfavourable 
E) $44,000 unfavourable

Question 7

Answer the following question(s)using the information below.Rutch Corporation manufactured 54,000 door jambs during September.The fixed-overhead cost allocation rate is $50.00 per machine-hour.The following fixed overhead data pertain to September:
  
-What is the production-volume variance?

Accepted Answer

A) $4,100 unfavourable 
B) $4,100 favourable 
C) $1,650 unfavourable 
D) $5,750 unfavourable 
E) $5,750 favourable 
A) $4,100 unfavourable 
B) $4,100 favourable 
C) $1,650 unfavourable 
D) $5,750 unfavourable 
E) $5,750 favourable

Question 8

The fixed manufacturing overhead efficiency variance is used to analyze overhead costs.

Accepted Answer

A) True 
 B)False

Question 9

How is a budgeted fixed overhead cost rate calculated?

Accepted Answer

The budgeted fixed overhead co

Question 10

Briefly explain the meaning of the variable overhead efficiency variance and the variable overhead rate variance.

Accepted Answer

The variable overhead efficiency varianc

Question 11

Use the information below to answer the following question(s).Michelle Inc.uses a level 4-variance analysis of its manufacturing overhead costs, and has the following results for April.A.Budgeted direct labour-hours per unit is used to allocate variable manufacturing overhead.Fixed overhead is allocated on a per unit basis.
b.Budgeted amounts for April are:
   C.Actual amounts for April are:
  
-What is the variable manufacturing overhead efficiency variance?

Accepted Answer

A) $80,000 favourable 
B) $80,000 unfavourable 
C) $101,200 favourable 
D) $101,200 unfavourable 
E) $181,200 favourable 
A) $80,000 favourable 
B) $80,000 unfavourable 
C) $101,200 favourable 
D) $101,200 unfavourable 
E) $181,200 favourable

Question 12

The variable overhead efficiency variance is computed in a different way than the efficiency variance for direct-cost items.

Accepted Answer

A) True 
 B)False

Question 13

Use the information below to answer the following question(s).Michelle Inc.uses a level 4-variance analysis of its manufacturing overhead costs, and has the following results for April.A.Budgeted direct labour-hours per unit is used to allocate variable manufacturing overhead.Fixed overhead is allocated on a per unit basis.
b.Budgeted amounts for April are:
   C.Actual amounts for April are:
  
-What is the Michelle Inc.fixed manufacturing overhead rate variance?

Accepted Answer

A) $10,000 favourable 
B) $10,000 unfavourable 
C) $13,500 unfavourable 
D) $13,500 favourable 
E) $14,625 favourable 
A) $10,000 favourable 
B) $10,000 unfavourable 
C) $13,500 unfavourable 
D) $13,500 favourable 
E) $14,625 favourable

Question 14

Human capital refers to the intangible skills provided by people and is an inventoriable cost under ASPE/IFRS.

Accepted Answer

A) True 
 B)False

Question 15

Kaywalk Ltd.delivers shoes in batches.The following information pertains to shipping dance shoes in June:
   Required:
a.Calculate the efficiency variance for variable shipping overhead costs.
b.Calculate the rate variance for variable shipping overhead costs.
c.Calculate the rate variance for fixed shipping overhead costs.
d.Calculate the production-volume variance for fixed shipping overhead costs.

Accepted Answer

a.((120,000/400)× 0.50 × $18)- ((120,000

Question 16

Answer the following question(s)using the information below.Kellar Corporation manufactured 1,500 chairs during June.The following variable overhead data pertain to June:
  
-What is the variable overhead rate variance?

Accepted Answer

A) $840 unfavourable 
B) $1,200 favourable 
C) $1,200 unfavourable 
D) $1,560 favourable 
E) $1,560 unfavourable 
A) $840 unfavourable 
B) $1,200 favourable 
C) $1,200 unfavourable 
D) $1,560 favourable 
E) $1,560 unfavourable

Question 17

Non-financial performance measures

Accepted Answer

A) vary from industry to industry. 
B) include variable cost but not fixed cost variances. 
C) include both variable and fixed cost variances. 
D) are used for performance evaluation, but not for planning and control. 
E) deal with personnel matters. 
A) vary from industry to industry. 
B) include variable cost but not fixed cost variances. 
C) include both variable and fixed cost variances. 
D) are used for performance evaluation, but not for planning and control. 
E) deal with personnel matters.

Question 18

What are the arguments for prorating a production-volume variance that has been deemed to be material among work-in-process, finished goods, and cost of goods sold, as opposed to writing it all off to cost of goods sold?

Accepted Answer

If variances are always written off to c

Question 19

The difference between budgeted fixed manufacturing overhead and the fixed manufacturing overhead allocated to actual output units achieved is called

Accepted Answer

A) an efficiency variance. 
B) a flexible-budget variance. 
C) a manufacturing overhead flexible-budget variance. 
D) a production-volume overhead variance. 
E) an unallocated variable cost. 
A) an efficiency variance. 
B) a flexible-budget variance. 
C) a manufacturing overhead flexible-budget variance. 
D) a production-volume overhead variance. 
E) an unallocated variable cost.

Question 20

Use the information below to answer the following question(s).Regal Company uses a single cost pool for fixed manufacturing overhead.The amount for June 2019 was budgeted at $500,000; however, the actual amount was $700,000.Actual production for June was 12,500 units, and actual machine hours were 10,000.Budgeted production included 17,750 units and 12,375 machine hours.
-Budgeted output for DuCane Small Engines Inc.was 20,000 engines during February 2019.Budgeted fixed overhead per output unit was $2.50, and 30,000 engines were actually produced.Actual fixed overhead was allocated at $3.00 per engine.What is the production-volume variance?

Accepted Answer

A) $33,500 favourable 
B) $25,000 unfavourable 
C) $30,000 favourable 
D) $30,000 unfavourable 
E) $25,000 favourable 
A) $33,500 favourable 
B) $25,000 unfavourable 
C) $30,000 favourable 
D) $30,000 unfavourable 
E) $25,000 favourable

Effective planning of variable overhead costs means that a company performs those variable overhead costs that primarily add value

If budgeted machine-hours allowed per actual output unit equals 1.0 hour, and budgeted variable manufacturing overhead per machine-hour is $200, what is the budgeted variable manufacturing overhead rate per output unit?

Answer the following question(s)using the information below.Cakewalk Ltd.delivers shoes in batches.The following information pertains to shipping dance shoes in June: -What is the Cakewalk Ltd.efficiency variance for variable shipping overhead costs?

Actual overhead is $700,000, while budgeted overhead is $598,000.What is the fixed overhead static-budget variance if 250,000 units are produced and 225,000 are budgeted?

Use the information below to answer the following question(s).Moeller Electric manufactures light fixtures.The following information pertains to the company's manufacturing overhead data. -What is Moeller Electric's variable manufacturing overhead static-budget variance?

Answer the following question(s)using the information below.Rutch Corporation manufactured 54,000 door jambs during September.The fixed-overhead cost allocation rate is $50.00 per machine-hour.The following fixed overhead data pertain to September: -What is the production-volume variance?

The fixed manufacturing overhead efficiency variance is used to analyze overhead costs.

How is a budgeted fixed overhead cost rate calculated?

Briefly explain the meaning of the variable overhead efficiency variance and the variable overhead rate variance.

The variable overhead efficiency variance is computed in a different way than the efficiency variance for direct-cost items.

Human capital refers to the intangible skills provided by people and is an inventoriable cost under ASPE/IFRS.

Answer the following question(s)using the information below.Kellar Corporation manufactured 1,500 chairs during June.The following variable overhead data pertain to June: -What is the variable overhead rate variance?

Non-financial performance measures

What are the arguments for prorating a production-volume variance that has been deemed to be material among work-in-process, finished goods, and cost of goods sold, as opposed to writing it all off to cost of goods sold?

The difference between budgeted fixed manufacturing overhead and the fixed manufacturing overhead allocated to actual output units achieved is called

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters

Exam 8: Flexible Budgets, Variances, and Management Control: II

Effective planning of variable overhead costs means that a company performs those variable overhead costs that primarily add value

If budgeted machine-hours allowed per actual output unit equals 1.0 hour, and budgeted variable manufacturing overhead per machine-hour is $200, what is the budgeted variable manufacturing overhead rate per output unit?

Answer the following question(s)using the information below.Cakewalk Ltd.delivers shoes in batches.The following information pertains to shipping dance shoes in June: -What is the Cakewalk Ltd.efficiency variance for variable shipping overhead costs?

Actual overhead is $700,000, while budgeted overhead is $598,000.What is the fixed overhead static-budget variance if 250,000 units are produced and 225,000 are budgeted?

Use the information below to answer the following question(s).Moeller Electric manufactures light fixtures.The following information pertains to the company's manufacturing overhead data. -What is Moeller Electric's variable manufacturing overhead static-budget variance?

Answer the following question(s)using the information below.Rutch Corporation manufactured 54,000 door jambs during September.The fixed-overhead cost allocation rate is $50.00 per machine-hour.The following fixed overhead data pertain to September: -What is the production-volume variance?

The fixed manufacturing overhead efficiency variance is used to analyze overhead costs.

How is a budgeted fixed overhead cost rate calculated?

Briefly explain the meaning of the variable overhead efficiency variance and the variable overhead rate variance.

The variable overhead efficiency variance is computed in a different way than the efficiency variance for direct-cost items.

Human capital refers to the intangible skills provided by people and is an inventoriable cost under ASPE/IFRS.

Answer the following question(s)using the information below.Kellar Corporation manufactured 1,500 chairs during June.The following variable overhead data pertain to June: -What is the variable overhead rate variance?

Non-financial performance measures

What are the arguments for prorating a production-volume variance that has been deemed to be material among work-in-process, finished goods, and cost of goods sold, as opposed to writing it all off to cost of goods sold?

The difference between budgeted fixed manufacturing overhead and the fixed manufacturing overhead allocated to actual output units achieved is called

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters