Question 1

Which of the following would not appear on a flexible budget performance report as shown in the text?

Accepted Answer

A) Variable costs. 
B) Mixed costs. 
C) A flexible budget adjusted to the actual level of activity. 
D) The previous year's actual costs. 
A) Variable costs. 
B) Mixed costs. 
C) A flexible budget adjusted to the actual level of activity. 
D) The previous year's actual costs.

Question 2

Pinion Memorial Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for August was based on 2,700 meals.The diner's director has  provided the following cost formulas to use in budgets:   The director has also provided the diner's statement of actual expenses for the month:   Required:
Prepare a report showing the spending variances for each of the expenses and for total expenses for August.Label each variance as favorable (F)or unfavorable (U).

Accepted Answer

The answer of Pinion Memorial Diner is a charity supported...

Question 3

Mouton Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,300 units, but its actual level of activity was 7,350 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July:

Data used in budgeting:
  Actual results for July:  
-The spending variance for manufacturing overhead in July would be closest to:

Accepted Answer

A) $780 F 
B) $690 U 
C) $780 U 
D) $690 F 
A) $780 F 
B) $690 U 
C) $780 U 
D) $690 F

Question 4

Seard Clinic uses patient-visits as its measure of activity.The clinic has provided the following report:   Required:
Prepare the clinic's flexible budget performance report for December.Label each variance as favorable (F)or unfavorable (U).

Accepted Answer

The answer of Seard Clinic uses patient-visits as its measure...

Question 5

Hamner Corporation's flexible budget performance report for last month shows that actual indirect materials cost,a variable cost,was $45,240 and that the spending variance for indirect materials cost was $3,480 unfavorable.During that month,the company worked 17,400 machine-hours.Budgeted activity for the month had been 17,000 machine-hours.The cost formula per machine-hour for indirect materials cost must have been closest to:

Accepted Answer

A) $2.46 
B) $2.87 
C) $2.40 
D) $2.80 
A) $2.46 
B) $2.87 
C) $2.40 
D) $2.80

Question 6

During May,Hiles Corporation budgeted for 31,000 customers,but actually served 29,000 customers.The company uses the following revenue and cost formulas in its budgeting,where q is the number of customers served:

Revenue: $4.40q
Wages and salaries: $35,800 + $1.70q 
Supplies: $0.60q
Insurance: $12,300
Miscellaneous: $5,500 + $0.10q

Required:
Prepare the company's flexible budget for May based on the actual level of activity for the month.

Accepted Answer

The answer of During May,Hiles Corporation budgeted for 31,000 customers,but...

Question 7

Fussner Medical Clinic measures its activity in terms of patient-visits.Last month,the budgeted level of activity was 1,610 patient-visits and the actual level of activity was 1,670 patient-visits.The cost formula for administrative expenses is $3.30 per patient-visit plus $17,900 per month.The actual administrative expense was $24,600.In the clinic's flexible budget performance report for last month,the spending variance for administrative expenses was:

Accepted Answer

A) $1,387 U 
B) $198 U 
C) $69 U 
D) $1,189 U 
A) $1,387 U 
B) $198 U 
C) $69 U 
D) $1,189 U

Question 8

If the actual level of activity is 4% more than planned,then the variable costs in the static budget should be increased by 4% before comparing them to actual costs.

Accepted Answer

A) True 
 B)False

Question 9

Mock Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,100 client-visits, but its actual level of activity was 3,150 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:

Data used in budgeting:
  Actual results for August:  
-The administrative expenses in the planning budget for August would be closest to:

Accepted Answer

A) $5,740 
B) $5,934 
C) $6,030 
D) $5,760 
A) $5,740 
B) $5,934 
C) $6,030 
D) $5,760

Question 10

Amadon Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,900 units, but its actual level of activity was 7,920 units. The company has provided the following data concerning the formulas to be used in its budgeting:

-The direct labor in the planning budget for July would be closest to:

Accepted Answer

A) $41,868 
B) $41,080 
C) $41,184 
D) $41,974 
A) $41,868 
B) $41,080 
C) $41,184 
D) $41,974

Question 11

Friou Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 6,300 units, but its actual level of activity was 6,250 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July:

Data used in budgeting:
  Actual results for July:  
-The net operating income in the flexible budget for July would be closest to:

Accepted Answer

A) $19,050 
B) $28,279 
C) $18,475 
D) $27,832 
A) $19,050 
B) $28,279 
C) $18,475 
D) $27,832

Question 12

Pong Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 1,980 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December:

Data used in budgeting:
  Actual results for December:  
-The facility expenses in the flexible budget for December would be closest to:

Accepted Answer

A) $14,640 
B) $14,187 
C) $14,475 
D) $14,700 
A) $14,640 
B) $14,187 
C) $14,475 
D) $14,700

Question 13

Crovo Corporation uses customers served as its measure of activity.During December,the company budgeted for 38,000 customers,but actually served 40,000 customers.The company has provided the following data concerning the formulas used in its budgeting and its actual results for December:
Data used in budgeting:   Actual results for December:   Required:
Prepare a report showing the company's revenue and spending variances for December.Label each variance as favorable (F)or unfavorable (U).

Accepted Answer

The answer of Crovo Corporation uses customers served as its...

Question 14

Wohner Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 5,000 units, but its actual level of activity was 5,050 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:

Data used in budgeting:  
 
Actual results for August:   
-The overall revenue and spending variance (i.e. ,the variance for net operating income in the revenue and spending variance column on the flexible budget performance report)for August would be closest to:

Accepted Answer

A) $7,060 U 
B) $7,060 F 
C) $7,980 U 
D) $7,980 F 
A) $7,060 U 
B) $7,060 F 
C) $7,980 U 
D) $7,980 F

Question 15

Maliszewski Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 3,400 tenant-days, but its actual level of activity was 3,410 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:  
-The net operating income in the flexible budget for March would be closest to:

Accepted Answer

A) $14,625 
B) $11,320 
C) $11,408 
D) $14,711 
A) $14,625 
B) $11,320 
C) $11,408 
D) $14,711

Question 16

Langner Clinic uses client-visits as its measure of activity. During February, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,740 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for February:

Data used in budgeting:
  Actual results for February:  
-The spending variance for medical supplies in February would be closest to:

Accepted Answer

A) $390 F 
B) $250 U 
C) $250 F 
D) $390 U 
A) $390 F 
B) $250 U 
C) $250 F 
D) $390 U

Question 17

Hertzler Corporation uses customers served as its measure of activity.During November,the company budgeted for 33,000 customers,but actually served 34,000 customers.The company uses the following revenue and cost formulas in its budgeting,where q is the number of customers served:

Revenue: $3.20q 
Wages and salaries: $26,600 + $1.20q
Supplies: $0.40q
Insurance: $7,900
Miscellaneous: $6,400 + $0.10q
The company reported the following actual results for November:   Required:
Prepare a report showing the company's revenue and spending variances for November.Label each variance as favorable (F)or unfavorable (U).

Accepted Answer

The answer of Hertzler Corporation uses customers served as its...

Question 18

Soehl Natural Dying Corporation measures its activity in terms of skeins of yarn dyed.Last month,the budgeted level of activity was 14,100 skeins and the actual level of activity was 13,700 skeins.The company's owner budgets for dye costs,a variable cost,at $0.40 per skein.The actual dye cost last month was $4,510.In the company's flexible budget performance report for last month,what would have been the spending variance for dye costs?

Accepted Answer

A) $970 F 
B) $132 F 
C) $160 F 
D) $1,130 F 
A) $970 F 
B) $132 F 
C) $160 F 
D) $1,130 F

Question 19

Lizana Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,680 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December

Data used in budgeting:
  Actual results for December:  
-The activity variance for net operating income in December would be closest to:

Accepted Answer

A) $330 U 
B) $330 F 
C) $5,180 U 
D) $5,180 F 
A) $330 U 
B) $330 F 
C) $5,180 U 
D) $5,180 F

Question 20

Maliszewski Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 3,400 tenant-days, but its actual level of activity was 3,410 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:  
-The expendables in the flexible budget for March would be closest to:

Accepted Answer

A) $32,800 
B) $31,598 
C) $32,895 
D) $31,413 
A) $32,800 
B) $31,598 
C) $32,895 
D) $31,413

Which of the following would not appear on a flexible budget performance report as shown in the text?

Seard Clinic uses patient-visits as its measure of activity.The clinic has provided the following report: Required: Prepare the clinic's flexible budget performance report for December.Label each variance as favorable (F)or unfavorable (U).

If the actual level of activity is 4% more than planned,then the variable costs in the static budget should be increased by 4% before comparing them to actual costs.

Managerial Accounting and Cost Concepts

Job-Order Costing

Process Costing

Cost-Volume-Profit Relationships

Variable Costing and Segment Reporting: Tools for Management

Activity-Based Costing: a Tool to Aid Decision Making

Profit Planning

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Statement of Cash Flows

Financial Statement Analysis

Least-Squares Regression Computations

Appendix B: Cost of Quality

The Predetermined Overhead Rate and Capacity

Further Classification of Labor Costs

Fifo Method

Service Department Allocations

Abc Action Analysis

Using a Modified Form of Activity-Based Costing to Determine Product Costs for External Reports

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variances

Transfer Pricing

Service Department Charges

The Concept of Present Value

Income Taxes in Capital Budgeting Decisions

The Direct Method of Determining the Net Cash Provided by Operating Activities

Pricing Products and Services

Profitability Analysis

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Exam 8: Flexible Budgets and Performance Analysis

Which of the following would not appear on a flexible budget performance report as shown in the text?

Seard Clinic uses patient-visits as its measure of activity.The clinic has provided the following report: Required: Prepare the clinic's flexible budget performance report for December.Label each variance as favorable (F)or unfavorable (U).

If the actual level of activity is 4% more than planned,then the variable costs in the static budget should be increased by 4% before comparing them to actual costs.

Managerial Accounting and Cost Concepts

Job-Order Costing

Process Costing

Cost-Volume-Profit Relationships

Variable Costing and Segment Reporting: Tools for Management

Activity-Based Costing: a Tool to Aid Decision Making

Profit Planning

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Statement of Cash Flows

Financial Statement Analysis

Least-Squares Regression Computations

Appendix B: Cost of Quality

The Predetermined Overhead Rate and Capacity

Further Classification of Labor Costs

Fifo Method

Service Department Allocations

Abc Action Analysis

Using a Modified Form of Activity-Based Costing to Determine Product Costs for External Reports

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variances

Transfer Pricing

Service Department Charges

The Concept of Present Value

Income Taxes in Capital Budgeting Decisions

The Direct Method of Determining the Net Cash Provided by Operating Activities

Pricing Products and Services

Profitability Analysis

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