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Exam 18:Flexible Budgets, Standard Costs, and Variance Analysis

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Question 1

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The overhead applied to products during the period was closest to:

A) $151,993
B) $154,410
C) $157,200
D) $153,270

E) None of the above
F) B) and D)

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Question 2

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Reade Incorporated makes a single product--an electrical motor used in many long-haul trucks.The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period.Data concerning the most recent year appear below: The total manufacturing overhead is underapplied or overapplied by how much?

A) $61,347 Underapplied
B) $32,395 Underapplied
C) $61,347 Overapplied
D) $32,395 Overapplied

E) A) and C)
F) A) and D)

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Question 3

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Flick Company uses a standard cost system in which manufacturing overhead is applied to units of product on the basis of standard direct labor-hours.The company's total budgeted variable and fixed manufacturing overhead costs at the denominator level of activity are $20,000 for variable overhead and $30,000 for fixed manufacturing overhead.The predetermined overhead rate, including both fixed and variable components, is $2.50 per direct labor-hour.The standards call for two direct labor-hours per unit of output produced.Last year, the company produced 11,500 units of product and worked 22,000 direct labor-hours.Actual costs were $22,500 for variable overhead and $31,000 for fixed manufacturing overhead. Required: a.What is the denominator level of activity? b.What were the standard hours allowed for the output last year? c.What was the variable overhead rate variance? d.What was the variable overhead efficiency variance? e.What was the fixed manufacturing overhead budget variance? f.What was the fixed manufacturing overhead volume variance?

Moozi Dairy Products processes and sells two products: milk and butter.Last year, Moozi budgeted $1,200,000 of fixed manufacturing overhead and chose a denominator level of activity of 80,000 machine-hours.Each unit of milk at Moozi has a standard of 0.1 machine-hours and each unit of butter has a standard of 0.08 machine-hours.Last year, Moozi processed 560,000 units of milk and 340,000 units of butter.Moozi's total fixed manufacturing overhead incurred last year was $1,256,000.Actual machine-hours incurred for the year were 82,000.Moozi applies manufacturing overhead to its products on the basis of standard machine-hours. Required: Compute Moozi's fixed manufacturing overhead variances for last year.

Dapice Incorporated makes a single product--a critical part used in commercial airline seats.The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period.Data concerning the most recent year appear below: The fixed overhead volume variance is:

The total amount of manufacturing overhead applied is closest to:

What was Tantanka's variable overhead efficiency variance?

The fixed manufacturing overhead budget variance is:

Merone Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The company bases its predetermined overhead rate on 2,300 machine-hours.The company's total budgeted fixed manufacturing overhead is $5,060.In the most recent month, the total actual fixed manufacturing overhead was $4,660.The company actually worked 2,200 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 2,320 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?

Edlow Incorporated makes a single product--a critical part used in commercial airline seats.The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period.Data concerning the most recent year appear below: Required: a.Determine the variable overhead rate variance for the year. b.Determine the variable overhead efficiency variance for the year. c.Determine the fixed overhead budget variance for the year. d.Determine the fixed overhead volume variance for the year.

The total amount of manufacturing overhead applied is closest to:

Fenderson Incorporated makes a single product--a cooling coil used in commercial refrigerators.The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period.Data concerning the most recent year appear below: The company incurred a total of $370,077 in manufacturing overhead cost during the year. Required: a.Compute the variable component of the company's predetermined overhead rate. b.Compute the fixed component of the company's predetermined overhead rate. c.Compute the company's predetermined overhead rate. d.Determine whether overhead was underapplied or overapplied for the year and by how much.

The total amount of manufacturing overhead applied is closest to:

Held Incorporated makes a single product--an electrical motor used in many long-haul trucks.The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period.Data concerning the most recent year appear below: Required: a.Compute the variable component of the company's predetermined overhead rate. b.Compute the fixed component of the company's predetermined overhead rate. c.Compute the company's predetermined overhead rate. d.Determine the variable overhead rate variance for the year. e.Determine the variable overhead efficiency variance for the year. f.Determine the fixed overhead budget variance for the year. g.Determine the fixed overhead volume variance for the year. h.Determine whether overhead was underapplied or overapplied for the year and by how much.

The fixed component of the predetermined overhead rate is closest to:

In a standard costing system, if the actual fixed manufacturing overhead cost exceeds the budgeted fixed manufacturing overhead cost for the period, then fixed manufacturing overhead cost would be underapplied for the period.

The fixed manufacturing overhead budget variance for April was:

The fixed overhead budget variance is:

Emanuele Incorporated makes a single product--a critical part used in commercial airline seats.The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period.Data concerning the most recent year appear below: Required: a.Compute the variable component of the company's predetermined overhead rate. b.Compute the fixed component of the company's predetermined overhead rate. c.Compute the company's predetermined overhead rate. d.Determine the variable overhead rate variance for the year. e.Determine the variable overhead efficiency variance for the year. f.Determine the fixed overhead budget variance for the year. g.Determine the fixed overhead volume variance for the year. h.Determine whether overhead was underapplied or overapplied for the year and by how much.

Surma Incorporated makes a single product--a critical part used in commercial airline seats.The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period.Data concerning the most recent year appear below: The fixed component of the predetermined overhead rate is closest to: