Exam 8: Flexible Budgets, overhead Cost Variances, and Management Control

The balances in the variable overhead control account and the variable overhead control account are $120,000 and $125,000 respectively.The variable overhead spending variance is $6,000 and the variable overhead efficiency variance is $11,000.Which of the following entries would be required to record the variances in a standard costing system?

A $5,000 unfavorable flexible-budget variance indicates that ________.

The variable overhead efficiency variance measures the difference between the ________,multiplied by the budgeted variable overhead cost per unit of the cost-allocation base.

Outdoor Gear Corporation manufactured 5,000 coolers during October.The following variable overhead data relates to October: Calculate the actual machine hours used by Stark during October.

The accounting for 3-variance analysis is simpler than the 4-variance analysis,but some information is lost because the variable and fixed overhead spending variances are combined into a single total overhead spending variance.

Really Great Corporation manufactures industrial-sized landscaping trailers and uses budgeted machine-hours to allocate variable manufacturing overhead.The following information pertains to the company's manufacturing overhead data: Budgeted output units 40,000units Budgeted machine-hours 10,000houts Budgeted variable manufacturing overhead costs for 40,000 units \ 310,000 Actual output units produced 36,500 units Actual machine-hours used 14,600 hours Actual variable manufacturing overhead costs \ 350,400 What is the budgeted variable overhead cost rate per output unit?

The fixed overhead cost variance can be further subdivided into the ________.

Skizone Company's 4-Variance Analysis: Which of the following statements is true of Skizone's overhead variances?

The level 3 components for the fixed overhead variance are the fixed overhead spending variance and the fixed overhead production volume variance.

Osium Company made the following journal entry: Which of the following statements is true of the given journal entry?

Which of the following statements is true of variable overhead costs?

Casey Corporation produces a special line of basketball hoops.Casey Corporation produces the hoops in batches.To manufacture a batch of the basketball hoops,Casey Corporation must set up the machines and molds.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 molds 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 2005. Required: a.Calculate the efficiency variance for variable overhead setup costs. b.Calculate the spending variance for variable overhead setup costs. c.Calculate the flexible-budget variance for variable overhead setup costs. d.Calculate the spending variance for fixed overhead setup costs. e.Calculate the production-volume variance for fixed overhead setup costs.

When machine-hours are used as an overhead cost-allocation base,the most likely cause of a favorable variable overhead spending variance is ________.

For fixed manufacturing overhead,there is no ________.

Different management levels in Bates,Inc. ,require varying degrees of managerial accounting information.Because of the need to comply with the managers' requests,four different variances for manufacturing overhead are computed each month.The information for the September overhead expenditures is as follows: Required: a.Compute a 4-variance analysis for the plant controller. b.Compute a 3-variance analysis for the plant manager. c.Compute a 2-variance analysis for the corporate controller. d.Compute the flexible-budget variance for the manufacturing vice president.

Prorated allocation of production-volume variance has the effect of approximating the allocation of fixed costs based on actual costs and actual output.

Raposa,Inc. ,produces a special line of plastic toy racing cars.Raposa,Inc. ,produces the cars in batches.To manufacture a batch of the cars,Raposa,Inc. ,must set up the machines and molds.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 molds for different styles of car. 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 June 2015: Calculate the spending variance for fixed setup overhead costs.

Wainwright has budgeted construction overhead for August of $435,000 for fixed costs.Actual costs for the month totaled for $450,000 for fixed.Allocated fixed overhead totaled $430,000.The company tracks each item in an overhead control account before allocations are made to individual jobs.The fixed overhead spending variance for August was $15,000 unfavorable for fixed. Required: a.Make journal entries for the actual costs incurred. b.Make journal entries to record the variances for August.

If the company's fixed overhead spending variance was unfavorable it could be attributed to higher plant-leasing costs.

The variable overhead spending variance measures the difference between ________,multiplied by the actual quantity of variable overhead cost-allocation base used.