Info
Warning
Danger

Study Resources (Accounting)

Answer the following questions using the information below: Gus Corporation manufactured 10,000 golf bags during April. The fixed overhead cost-allocation rate is $40.00 per machine-hour. The following fixed overhead data pertain to March: ActualStatic Budget Production10,000 units12,000 units Machine-hours5,100 hours6,000 hours Fixed overhead cost for March$244,000$240,000 12) What is the flexible-budget amount? A) $200,000 B).
7 Views
View Answer
41) Wilson's Winter Woolens manufactures jackets and other wool clothing. A certain designed ski parka requires the following: Direct materials standard2 square yards at $13.50 per yard Direct manufacturing labor standard1.5 hours at $20.00 per hour During the third quarter, the company made 1,500 parkas and used 3,150 square yards of fabric.
7 Views
View Answer
31) What is the variable overhead spending variance? A) $4,500 unfavorable B) $3,937.50 unfavorable C) $4,500 favorable D) $3,937.50 favorable 32) What is the variable overhead efficiency variance? A) $3,937.50 favorable B) $3,937.50 unfavorable C) $4,500 favorable D) $4,500 unfavorable 33) What is the total variable overhead variance A) $7,875 unfavorable B) $3,937.50 f unfavorable C).
8 Views
View Answer
24) If a cost is considered controllable, it indicates that all aspects of the cost are under the control of the manager of the responsibility center to which that cost is assigned. 25) To create greater commitment to the budget, lower-level managers should participate in creating the budget. 26) Allscott Company.
8 Views
View Answer
80) Describe operating and financial budgets and give at least two examples of each discussed in the textbook. 81) Discuss the importance of the sales forecast and items that influence its accuracy. 1) Financial planning models: A) are not used in the budgeting process B) are not useful for sensitivity analysis C) are.
4 Views
View Answer
1) Responsibility accounting: A) is a system that measures the plans, budgets, actions, and actual results of a responsibility center B) is an arrangement of lines of responsibility within the organization C) explicitly incorporates continuous improvement anticipated during the budget period D) examines how a result will change if the original plan is.
6 Views
View Answer
Answer the following questions using the information below: Roberts Corporation manufactured 100,000 buckets during February. The overhead cost-allocation base is $5.00 per machine-hour. The following variable overhead data pertain to February: ActualBudgeted Production100,000 units100,000 units Machine-hours9,800 hours10,000 hours Variable overhead cost per machine-hour$5.25$5.00 21) What is the actual variable overhead cost? A) $49,000 B) $50,000.
6 Views
View Answer
50) Briefly explain the meaning of the variable overhead efficiency variance and the variable overhead spending variance. 51) Briefly explain why a favorable variable overhead spending variance may not always be desireable. 52) Can the variable overhead efficiency variance a.be computed the same way as the efficiency variance for direct-cost items? b.be.
7 Views
View Answer
11) A responsibility accounting system could: A) exclude all uncontrollable costs B) exclude controllable costs C) segregate uncontrollable costs from controllable costs D) Both A and C are correct. 12) Which statement about controllability is NOT true: A) few costs are clearly under the sole influence of one manager B) holds managers responsible for uncontrollable costs C) with.
6 Views
View Answer
4) Kaizen budgeting involves: A) large cost reductions B) management directed improvements C) continual small cost reductions D) continual small revenue increases 5) Kaizen budgeting is driven by: A) management B) employees C) stockholders D) creditors Answer the following questions using the information below: Sherry and John Enterprises are using the kaizen approach to budgeting for 2011. The budgeted income.
6 Views
View Answer
33) The president of the company, Gregory Peters, has come to you for help. Use the following data to prepare a flexible budget for possible sales/production levels of 10,000, 11,000, and 12,000 units. Show the contribution margin at each activity level. Sales price$24 per unit Variable costs: Manufacturing$12 per unit Administrative$ 3 per.
9 Views
View Answer
36) Abby Company has just implemented a new cost accounting system that provides two variances for fixed manufacturing overhead. While the company's managers are familiar with the concept of spending variances, they are unclear as to how to interpret the production-volume overhead variances. Currently, the company has a production capacity.
8 Views
View Answer
21) September's direct labor price variance is: A) $210.00 unfavorable B) $210.00 favorable C) $70.00 unfavorable D) $70.00 favorable 22) September's direct labor efficiency variance is: A) $280.00 favorable B) $280.00 unfavorable C) $210.00 favorable D) $210.00 unfavorable Answer the following questions using the information below: These questions refer to.
5 Views
View Answer
Answer the following questions using the information below: Sawyer Industries, Inc. (SII), developed standard costs for direct material and direct labor. In 2011, SII estimated the following standard costs for one of their major products, the 30-gallon heavy-duty plastic container.   Budgeted quantityBudgeted price Direct materials0.20 pounds$25 per pound Direct labor0.10 hours$15 per hour During.
7 Views
View Answer
15) Bebee Corporation currently produces cardboard boxes in an automated process. Expected production per month is 40,000 units, direct-material costs are $0.60 per unit, and manufacturing overhead costs are $18,000 per month. Manufacturing overhead is all fixed costs. What is the flexible budget for 20,000 and 40,000 units, respectively? A).
11 Views
View Answer
31) Everjoice Company makes clocks. The fixed overhead costs for 20X5 total $720,000. The company uses direct labor-hours for fixed overhead allocation and anticipates 240,000 hours during the year for 480,000 units. An equal number of units are budgeted for each month. During June, 42,000 clocks were produced and $63,000.
5 Views
View Answer
Answer the following questions using the information below: Hector's Camera Shop has prepared the following flexible budget for September and is in the process of interpreting the variances. F denotes a favorable variance and U denotes an unfavorable variance.   Flexible    Variances   BudgetPriceEfficiency Material A$20,000$1,000U$1,200F Material B30,000500F800U Material C40,0001,400U1,000F   31) The actual amount spent for Material A was:.
8 Views
View Answer
29) The goal of variance analysis is for managers to understand why variances arise, to learn, and to improve future performance. 30) Employees logging in to production floor terminals and other modern technologies greatly facilitate the use of a standard costing system. 31) Possible operational causes of an unfavorable direct materials.
7 Views
View Answer
13) Bach Table Company manufactures tables for schools. The 2011 operating budget is based on sales of 40,000 units at $50 per table. Operating income is anticipated to be $120,000. Budgeted variable costs are $32 per unit, while fixed costs total $600,000. Actual income for 2011 was a surprising $354,000.
4 Views
View Answer
23) The flexible budget will report ________ for variable costs. A) $256,000 B) $300,000 C) $240,000 D) $320,000 24) The flexible budget will report ________ for the fixed costs. A) $229,000 B) $225,000 C) $180,000 D) $286,250 25) The flexible-budget variance for variable costs is: A) $16,000 unfavorable B) $60,000.
10 Views
View Answer
41) The variable overhead efficiency variance is computed in a different way than the efficiency variance for direct-cost items. 42) The variable overhead flexible-budget variance measures the difference between the actual variable overhead costs and the flexible-budget variable-overhead costs. 43) The variable overhead efficiency variance measures the efficiency with which the.
5 Views
View Answer
4) An unfavorable sales-volume variance could result from: A) decreased demand for the product B) competitors taking market share C) customer dissatisfaction with the product D) All of these answers are correct. 5) If a sales-volume variance was caused by poor-quality products, then the ________ would be in the best.
32 Views
View Answer
Answer the following questions using the information below: Monetary Company has the following sales budget for the last six months of 2011: July              $200,000              October              $ 180,000 August              160,000November              200,000 September              220,000December              188,000 Historically, the cash collection of sales has been as follows: 65% of sales collected in the month of sale, 25% of sales collected.
14 Views
View Answer
43) The following data for the Lewgrow Garden Supplies Company pertains to the production of 2,500 garden spades during March. The spade consists of a wooden handle and a metal forged tool that comes in contact with the ground. Direct Materials (all materials purchased were used): Standard cost: $1.00 per handle.
9 Views
View Answer
14) The Japanese use kaizen to mean financing alternatives. 15) Kaizen budgeting does NOT make sense for cost centers. 16) Kaizen budgeting encourages major improvements rather than small incremental changes. 17) Kaizen budgeting allows for budgeting of small incremental increases in costs each budgeting period to allow for the effects of.
7 Views
View Answer
21) An organization structure is an arrangement of lines of responsibility within the entity. 22) A responsibility center can be structured to promote better alignment of individual and company goals. 23) Management will most likely behave the same way if a department is structured as a cost center or if.
6 Views
View Answer
19) Variances often affect each other. 20) If variance analysis is used for performance evaluation, managers are encouraged to meet targets using creativity and resourcefulness. 21) When using variance for performance evaluation, managers often focus on effectiveness and efficiency as two of the common attributes used in comparing expected results.
6 Views
View Answer
1) The variable overhead flexible-budget variance measures the difference between: A) actual variable overhead costs and the static budget for variable overhead costs B) actual variable overhead costs and the flexible budget for variable overhead costs C) the static budget for variable overhead costs and the flexible budget for variable.
5 Views
View Answer
25) The following information pertains to Amigo Corporation: MonthSalesPurchases July$30,000$10,000 August34,00012,000 September38,00014,000 October42,00016,000 November48,00018,000 December60,00020,000 ?Cash is collected from customers in the following manner: Month of sale (2% cash discount)              30% Month following sale50% Two months following sale15% Amount uncollectible5% ?40% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month. Required:.
14 Views
View Answer
22) All unfavorable overhead variances decrease operating income compared to the budget. 23) A favorable fixed overhead flexible-budget variance indicates that actual fixed costs exceeded the lump-sum amount budgeted. 24) Fixed costs for the period are by definition a lump sum of costs that remain unchanged and therefore the fixed.
8 Views
View Answer
45) Littrell Company produces chairs and has determined the following direct cost categories and budgeted amounts: Standard InputsStandard Cost Categoryfor 1 outputper input Direct Materials1.00$7.50 Direct Labor0.309.00 Direct Marketing0.503.00 Actual performance for the company is shown below: Actual output: (in units)4,000 Direct Materials: Materials costs$30,225 Input purchased and used3,900 Actual price per input$7.75 Direct Manufacturing Labor: Labor costs$11,470 Labor-hours of input1,240 Actual price.
6 Views
View Answer
3) Which of the following is NOT a step in developing budgeted variable overhead rates? A) identifying the variable overhead costs associated with each cost-allocation base B) estimating the budgeted denominator level based on expected utilization of available capacity C) selecting the cost-allocation bases to use D) choosing the period.
6 Views
View Answer
47) Give at least three good reasons why an unfavorable efficiency variance for direct manufacturing labor might be reported. 1) A purchasing manager's performance is best evaluated using the: A) direct materials price variance B) direct materials flexible-budget variance C) direct manufacturing labor flexible-budget variance D) affect the manager's action.
7 Views
View Answer
11) Variable-manufacturing overhead costs were ________ for actual output. A) higher than expected B) the same as expected C) lower than expected D) indeterminable 12) The variable overhead flexible-budget variance can be further subdivided into the: A) price variance and the efficiency variance B) static-budget variance and sales-volume variance C).
6 Views
View Answer
Everclean Filter Corporation used the following data to evaluate their current operating system. The company sells items for $10 each and had used a budgeted selling price of $11 per unit.   ActualBudgeted Units sold306,000 units300,000 units Variable costs$965,000$950,000 Fixed costs$ 53,000$ 50,000 13) What is the static-budget variance of revenues? A) $60,000 favorable B) $240,000.
8 Views
View Answer
Answer the following questions using the information below: Brent Enterprises reports the year-end information from 2011 as follows: Sales (35,000 units)$280,000 Cost of goods sold105,000 Gross margin175,000 Operating expenses100,000 Operating income$ 75,000 Brent is developing the 2012 budget. In 2012 the company would like to increase selling prices by 4%, and as a result expects a.
6 Views
View Answer
Answer the following questions using the information below: The actual information pertains to the month of September. As part of the budgeting process, Kriger Fencing Company developed the following static budget for September. Kriger is in the process of preparing the flexible budget and understanding the results.   ActualFlexibleStatic ResultsBudgetBudget Sales volume (in units)10,000     12,500 Sales.
5 Views
View Answer
3) Fixed overhead costs must be unitized for: A) financial reporting purposes B) planning purposes C) calculating the production-volume variance D) Both A and C are correct. 4) Generally Accepted Accounting Principles require that unitized fixed manufacturing costs be used for: A) pricing decisions B) costing decisions C) external reporting.
10 Views
View Answer
1) Multinational budgeting is more complex than budgeting in a domestic environment due to the possibility of: A) exchange rate fluctuations B) sophisticated techniques used by multinationals such as forward, future, and options contracts C) different political, legal, and economic environments faced by multinationals D) All of these answers are.
12 Views
View Answer
35) Mayberry Company had the following journal entries recorded for the end of June. Unfortunately, the company's only accountant quit on July 10 and the president is at a loss as to the company's performance for the month of June. Materials Control300,000 Direct Materials Price Variance10,000 Accounts Payable Control290,000 Work-in-Process Control120,000 Direct Materials Efficiency Variance8,000 Materials.
9 Views
View Answer