Exam 8: Flexible Budgets and Variance Analysis

Differences between the actual results and the flexible budget at the actual level of output achieved are ________ variances.

One cause of a flexible budget variance for direct labor may be a difference between standard and actual hourly wage rates for factory workers.

The direct materials price variance is based on the standard quantity of inputs allowed for the actual output.

Parrish Company had the following information available for its specialty product: Standards for one unit of product: Direct Materials: 5 pounds at $2 per pound Direct Labor: 0.50 hour at $16 per hour Materials and Labor Used to produce 8,500 units: Direct Materials: ? pounds at $2.10 per pound Direct Labor: 4,000 hours at $16.80 per hour If the Direct Materials Quantity Variance is $7,000 Unfavorable,what is the actual quantity of direct materials used?

Indian Company has the following information available for variable overhead costs.Direct labor hours are the cost driver for variable overhead costs. Actual variable overhead costs \ 5,120 Standard variable overhead costs \ 3.00 per hour Actual direct labor hours 2,000 hours Standard direct labor hours per unit 3 hours Units produced 1,000 What is the variable overhead spending variance?

Wetzel Company has actual fixed overhead costs of $14,500.Fixed overhead costs based on the flexible budget and the standard use of the cost driver are $14,400.Actual variable overhead costs are $14,700.Flexible budget costs for variable overhead costs are $15,000.What is the flexible-budget variance for fixed overhead costs?

A quantity variance for direct materials measures the deviation between the quantity of inputs that should have been used to achieve the actual output and the actual quantity of inputs used to achieve the actual output.

The variable overhead spending variance combines ________ and ________ effects.

Efficiency is the degree to which a goal or objective is met.

Spending less than budgeted for maintenance costs will result in a(n)________ variance.When actual revenues exceed budgeted revenues,this results in a(n)________ variance.

At 60,000 machine hours,Clark Company's static budget for variable overhead costs is $180,000.At 60,000 machine hours,the company's static budget for fixed overhead costs is $300,000.Machine hours are the cost driver of all overhead costs.The static budget is based on 60,000 machine hours.At 60,000 machine hours,the company produces 40,000 units.The following data is available: Actual units produced and sold 42,000 Actual machine hours 64,000 Actual variable overhead costs \1 85,600 Actual fixed overhead costs \3 02,400 What is the fixed overhead spending variance?

Cornell Company had the following information available for its specialty product: Standards for one unit of product: Direct Materials: 5 pounds at $2 per pound Direct Labor: 0.50 hour at $16 per hour Materials and Labor Used to produce 8,500 units: Direct Materials: 46,000 pounds at $3 per pound Direct Labor: 4,000 hours at ? per hour If the Direct Labor Price Variance is $4,600 Unfavorable,what is the actual labor rate per hour?

Yellow Cake Company planned to produce and sell 900 units at a total cost of $180,000.Actual production and sales were 900 units at a cost of $170,000.The company was ________.

Huntsman Company's variable selling and administrative expenses are $48,000 at a production level of 6,000 units.If the production level is 8,000 units,what are the variable selling administrative expenses?

Sales-activity variances measure how efficient managers have been in meeting the planned sales goal.

What are some common causes of unfavorable quantity variances for direct labor?

Assume sales are the cost driver for product costs.The difference between the static budget amount for sales and the flexible budget amount for sales at the actual level of sales is called the ________.The difference between the flexible budget amount for sales at the actual level of sales and the actual amount for sales is called the ________.

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Rate variances are the same as ________ variances.Efficiency variances are the same as ________ variances.

Fill in the blanks to complete the flexible budget for Mammoth Company.Assume the different levels of output are in the relevant range. Budget Various Levels Formula of Output Per Unit Units 3,000 4,000 5,000 Sales \2 5 - - - Variable costs: Manufacturing - - \3 2,000 - Administrative \2 .625 - - - Fixed costs: Manufacturing - - \2 5,000 Administrative \2 3,500 - - Operating income - - -