Exam 21: Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

(Appendix 11A)The Santos Corporation made an error when selecting a denominator level of activity and chose a much lower level than was realistic.This error would most likely result in a large:

(Appendix 11A)Vette Tie Corporation has developed the following manufacturing overhead standards to use in applying overhead to the production of its hand-painted silk ties.Manufacturing overhead at Vette is applied to production on the basis of standard direct labor-hours (DLHs). The above standards were based on an expected annual volume of 60, 000 ties.The actual results for last year were as follows: What total amount of manufacturing overhead cost (variable and fixed)did Vette apply to the 58, 000 ties produced during the year?

(Appendix 11A)Omary Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs).The company has provided the following data for the most recent month: What was the total of the variable overhead rate and fixed manufacturing overhead budget variances for the month?

(Appendix 11A)The Murray Corporation makes and sells a single product.The company recorded the following activity and cost data for May: The fixed component of the predetermined overhead rate is $0.95 per direct labor-hour. The amount of fixed manufacturing overhead cost applied to work in process during May was:

(Appendix 11A)Cuda Manufacturing Corporation uses a standard cost system with machine-hours (MHs)as the activity base for overhead.The following information relates to Cuda's operations last year: What was Cuda's variable overhead rate variance?

(Appendix 11A)The following data for February has been provided by Gillard Corporation. The budget variance for February is:

(Appendix 11A)Cuda Manufacturing Corporation uses a standard cost system with machine-hours (MHs)as the activity base for overhead.The following information relates to Cuda's operations last year: What total amount of manufacturing overhead cost (variable and fixed)did Cuda apply to production?

(Appendix 11A)Denby Corporation applies manufacturing overhead to products on the basis of standard machine-hours.Budgeted and actual fixed manufacturing overhead costs for the most recent month appear below: The company based its original budget on 6, 400 machine-hours.The company actually worked 6, 710 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 6, 540 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?

(Appendix 11A)Tillinghast Corporation estimates that its variable manufacturing overhead is $9.60 per machine-hour and its fixed manufacturing overhead is $14, 630 per period. If the denominator level of activity is 1, 000 machine-hours, the variable component in the predetermined overhead rate would be:

(Appendix 11A)You have just been hired as the new executive assistant to the manager of the Eastern Division of Global Manufacturing.You have been given the following incomplete records concerning manufacturing overhead for last year: The company uses a standard cost system in which manufacturing overhead costs are applied to products on the basis of standard direct labor-hours (DLHs). Required: a.Compute the variable overhead rate variance and indicate whether it was favorable or unfavorable. b.Compute the fixed overhead volume variance and indicate whether it was favorable or unfavorable.

(Appendix 11A)Pohl Corporation uses a standard cost system in which manufacturing overhead is applied on the basis of standard machine-hours.For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20, 000 machine-hours: During June, 17, 000 machine-hours were used to complete 13, 000 units of product, and the following actual total overhead costs were incurred: At standard, each unit of finished product requires 1.4 hours of machine time. The total predetermined overhead rate per machine-hour for June was:

(Appendix 11A)Nitrol Corporation manufactures brass vases using a standard cost system with standard machine-hours as the activity base for overhead.The following information relates to vase production at Nitrol for last year: The standard machine-hours per vase is 1.25.Last year Nitrol produced 84, 000 vases. What was Nitrol's variable overhead rate variance for last year?

(Appendix 11A)The Murray Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours (DLHs).The company recorded the following activity and cost data for May: The fixed manufacturing overhead budget variance for May was:

(Appendix 11A)Nitrol Corporation manufactures brass vases using a standard cost system with standard machine-hours as the activity base for overhead.The following information relates to vase production at Nitrol for last year: The standard machine-hours per vase is 1.25.Last year Nitrol produced 84, 000 vases. What was Nitrol's total underapplied or overapplied overhead cost for last year?

(Appendix 11A)At the beginning of last year, Tari Corporation budgeted $300, 000 of fixed manufacturing overhead and chose a denominator level of activity of 600, 000 machine-hours.At the end of the year, Tari's fixed manufacturing overhead budget variance was $9, 000 favorable.Its fixed manufacturing overhead volume variance was $15, 000 favorable.Actual direct labor-hours for the year were 625, 000.What was Tari's total standard machine-hours allowed for last year's output?

(Appendix 11A)The Dillon Corporation makes and sells a single product.Overhead costs are applied on the basis of standard direct labor-hours.The standard cost card shows that 5 direct labor-hours are required per unit.The Dillon Corporation had the following budgeted and actual data for March: The variable overhead efficiency variance for March is:

(Appendix 11A)The fixed manufacturing overhead budget variance is:

(Appendix 11A)An outdoor barbecue grill manufacturer has a standard costing system based on standard direct labor-hours (DLHs)as the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead budget variance for the period is closest to:

(Appendix 11A)Alex Corporation has a large underapplied overhead balance in the manufacturing overhead account.This could be explained by:

(Appendix 11A)A company has a standard cost system in which fixed and variable manufacturing overhead costs are applied to products on the basis of direct labor-hours.The company's choice of the denominator level of activity affects the fixed manufacturing overhead volume variance.