Question 1

In preparing flexible budgets,the costs that remain constant in total are ________ costs.Those costs that change in total are ________ costs.

Accepted Answer

fixed; var...

Question 2

A company's flexible budget for 12,000 units of production showed sales,$48,000; variable costs,$18,000; and fixed costs,$16,000.The variable costs expected if the company produces and sells 16,000 units is:

Accepted Answer

A)  $48,000.
B)  $64,000.
C)  $40,000.
D)  $24,000.
E)  $18,000.

Question 3

Parallel Enterprises has collected the following data on one of its products.During the period the company produced 25,000 units.The direct materials price variance is:

Accepted Answer

A)  $27,500 unfavorable.
B)  $50,000 unfavorable.
C)  $50,000 favorable.
D)  $22,500 unfavorable.
E)  $22,500 favorable.

Question 4

Linx Company's output for a period was assigned the standard direct labor cost of $17,160.If the company had a favorable direct labor rate variance of $1,000 and an unfavorable direct labor efficiency variance of $275,what was the total actual cost of direct labor incurred during the period?

Accepted Answer

The answer of Linx Company's output for a period was...

Question 5

A flexible budget may be prepared:

Accepted Answer

A)  Before the operating period only.
B)  After the operating period only.
C)  During the operating period only.
D)  At any time in the planning period.
E)  Only when the company encounters excessive costs.

Question 6

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of variable costs for 20,000 units would be:

Accepted Answer

A)  $99,000.
B)  $90,000.
C)  $66,000.
D)  $30,000.
E)  $150,000.

Question 7

A flexible budget performance report compares the differences between:

Accepted Answer

A)  Actual performance and budgeted performance based on actual sales volume.
B)  Actual performance over several periods.
C)  Budgeted performance over several periods.
D)  Actual performance and budgeted performance based on budgeted sales volume.
E)  Actual performance and standard costs at the budgeted sales volume.

Question 8

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of operating income for 20,000 units would be:

Accepted Answer

A)  $30,000.
B)  $60,000.
C)  $69,000.
D)  $150,000.
E)  $32,727.

Question 9

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of sales for 20,000 units would be:

Accepted Answer

A)  $165,000.
B)  $150,000.
C)  $117,272.
D)  $181,500.
E)  $141,900.

Question 10

Define standard costs.How do they assist management?

Accepted Answer

Standard costs are preset costs for deli...

Question 11

Jake Co.has prepared the following fixed budget for the year,assuming production and sales of 30,000 units.This level of production represents 80% of capacity.
 Calculate the following flexible budget amounts at the indicated levels of capacity:

Accepted Answer

Operations at 60% of capacity (22,500 ...

Question 12

Sanchez Company's output for the current period was assigned a $200,000 standard direct materials cost.The direct materials variances included a $5,000 favorable price variance and a $3,000 unfavorable quantity variance.What is the actual total direct materials cost for the current period?

Accepted Answer

A)  $208,000.
B)  $198,000.
C)  $202,000.
D)  $192,000.
E)  $205,000.

Question 13

A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z.The company has just produced 1,000 units of this product,using 5,200 pounds of Material J that cost $9,880.The direct materials price variance is:

Accepted Answer

A)  $520 unfavorable.
B)  $400 unfavorable.
C)  $120 favorable.
D)  $520 favorable.
E)  $400 favorable.

Question 14

Georgia,Inc.has collected the following data on one of its products.The direct materials quantity variance is:

Accepted Answer

A)  $30,000 favorable.
B)  $13,750 unfavorable.
C)  $16,250 favorable.
D)  $30,000 unfavorable.
E)  $13,750 favorable.

Question 15

A company provided the following direct materials cost information.Compute the direct materials price variance.

Accepted Answer

A)  $81,000 Favorable.
B)  $81,000 Unfavorable.
C)  $80,750 Unfavorable.
D)  $80,750 Favorable.
E)  $78,250 Favorable.

Question 16

Identify the situation below that will result in a favorable variance.

Accepted Answer

A)  Actual revenue is higher than budgeted revenue.
B)  Actual revenue is lower than budgeted revenue.
C)  Actual income is lower than expected income.
D)  Actual costs are higher than budgeted costs.
E)  Actual expenses are higher than budgeted expenses.

Question 17

The overhead cost variance is calculated as:

Accepted Answer

A)  Standard applied overhead less budgeted overhead.
B)  Actual overhead incurred less standard overhead applied.
C)  Budgeted overhead less standard overhead applied.
D)  Actual overhead incurred less standard applied overhead.
E)  Actual fixed cost less budgeted overhead.

Question 18

When there is a difference between the actual and the standard capacity,which of the following,based solely on fixed overhead,occurs:

Accepted Answer

A)  Production variance.
B)  Volume variance.
C)  Overhead cost variance.
D)  Quantity variance.
E)  Controllable variance.

Question 19

A company's flexible budget for 36,000 units of production showed variable overhead costs of $54,000 and fixed overhead costs of $50,000.The company actually incurred total overhead costs of $95,300 while operating at a volume of 32,000 units.What is the controllable variance?

Accepted Answer

* $54,000 variable ...

Question 20

Static budget is another name for:

Accepted Answer

A)  Standard budget.
B)  Flexible budget.
C)  Variable budget.
D)  Fixed budget.
E)  Master budget.

Exam 21: Flexible Budgets and Standard Costs

A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z.The company has just produced 1,000 units of this product,using 5,200 pounds of Material J that cost $9,880.The direct materials price variance is:

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Sanchez Company's output for the current period was assigned a $200,000 standard direct materials cost.The direct materials variances included a $5,000 favorable price variance and a $3,000 unfavorable quantity variance.What is the actual total direct materials cost for the current period?

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Linx Company's output for a period was assigned the standard direct labor cost of $17,160.If the company had a favorable direct labor rate variance of $1,000 and an unfavorable direct labor efficiency variance of $275,what was the total actual cost of direct labor incurred during the period?

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In preparing flexible budgets,the costs that remain constant in total are ________ costs.Those costs that change in total are ________ costs.

Correct Answerverifiedfixed; var...View AnswerShow Answer

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of variable costs for 20,000 units would be:

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Identify the situation below that will result in a favorable variance.

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Parallel Enterprises has collected the following data on one of its products.During the period the company produced 25,000 units.The direct materials price variance is:

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Georgia,Inc.has collected the following data on one of its products.The direct materials quantity variance is:

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A company provided the following direct materials cost information.Compute the direct materials price variance.

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Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of operating income for 20,000 units would be:

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A company's flexible budget for 36,000 units of production showed variable overhead costs of $54,000 and fixed overhead costs of $50,000.The company actually incurred total overhead costs of $95,300 while operating at a volume of 32,000 units.What is the controllable variance?

Correct Answerverified* $54,000 variable ...View AnswerShow Answer

Define standard costs.How do they assist management?

Correct AnswerverifiedStandard costs are preset costs for deli...View AnswerShow Answer

A flexible budget performance report compares the differences between:

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When there is a difference between the actual and the standard capacity,which of the following,based solely on fixed overhead,occurs:

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A flexible budget may be prepared:

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Jake Co.has prepared the following fixed budget for the year,assuming production and sales of 30,000 units.This level of production represents 80% of capacity. Calculate the following flexible budget amounts at the indicated levels of capacity:

Correct AnswerverifiedOperations at 60% of capacity (22,500 ...View AnswerShow Answer

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of sales for 20,000 units would be:

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The overhead cost variance is calculated as:

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A company's flexible budget for 12,000 units of production showed sales,$48,000; variable costs,$18,000; and fixed costs,$16,000.The variable costs expected if the company produces and sells 16,000 units is:

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Static budget is another name for:

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In preparing flexible budgets,the costs that remain constant in total are costs.Those costs that change in total are costs.

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fixed; var...
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* $54,000 variable ...
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Standard costs are preset costs for deli...
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Operations at 60% of capacity (22,500 ...
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