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Exam 9: Flexible Budgets Standard Costs and Variance Analysis

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Question 201

Multiple Choice

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The materials price variance for September is:

A) $1,150 U
B) $1,150 F
C) $1,160 F
D) $1,160 U

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

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Question 202

Multiple Choice

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The raw materials quantity variance for the month is closest to:

A) $86 U
B) $86 F
C) $94 U
D) $94 F

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

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Question 203

Multiple Choice

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The labor rate variance for the month is closest to:

Poorly trained workers could have an unfavorable effect on which of the following variances?

Hirons Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports.The cost formula for plane operating costs is $56,840 per month plus $2,874 per flight plus $13 per passenger.The company expected its activity in November to be 86 flights and 255 passengers, but the actual activity was 89 flights and 257 passengers.The actual cost for plane operating costs in November was $305,100.The spending variance for plane operating costs in November would be closest to:

The administrative expenses in the planning budget for May would be closest to:

A revenue variance is the difference between what the total sales revenue should be, given the actual level of activity of the period, and the actual total sales revenue.

A partial standard cost card for the single product produced by Mercer Company is given below: Direct materials: 3 pounds @ $8 per pound Direct labor: ? hours @ ? per hour Last period the company produced 4,000 units of product.Cost and other data associated with this production are given below: The direct materials purchases variance is computed when the materials are purchased. Required: a.Determine the number of pounds of direct materials purchased and used during the period. b.Determine the materials quantity variance. c.Determine the standard direct labor rate per direct labor hour. d.Determine the standard hours allowed for the production of the period.

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the materials price variance for the month?

The following information relates to the direct labor at Padmaja Manufacturing, Inc.for March: During March, Padmaja produced 2,100 units.What is Padmaja's labor efficiency variance for March?

Mongelli Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion.The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms.The Inn's overhead budget for the most recent month appears below: The Inn's variable overhead costs are driven by the number of guests. What would be the total budgeted overhead cost for a month if the activity level is 99 guests?

Hamiter Framing's cost formula for its supplies cost is $1,640 per month plus $9 per frame.For the month of August, the company planned for activity of 572 frames, but the actual level of activity was 573 frames.The actual supplies cost for the month was $7,080.The supplies cost in the planning budget for August would be closest to:

When using a flexible budget, a decrease in activity within the relevant range:

The spending variance for total expenses for October would have been closest to:

The following data have been provided by Moretta Corporation, a company that produces forklift trucks: Supplies cost is an element of variable manufacturing overhead.The variable overhead efficiency variance for supplies cost is:

The spending variance for "Other expenses" for October would have been closest to:

Mcinerney Jeep Tours operates jeep tours in the heart of the Colorado Rockies.The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps.One vehicle used in one tour on one day counts as a jeep.Each jeep has one tour guide.The company uses the following data in its budgeting: In October, the company budgeted for 325 guests and 91 jeeps.The actual activity for the month was 340 guests and 96 jeeps. Required: Prepare the company's flexible budget for the actual level of activity in October.

Rizzio Tech is a for-profit vocational school.The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course.The school uses the following data in its budgeting: In September, the school budgeted for 1,820 students and 173 courses.The actual activity for the month was 2,020 students and 178 courses. Required: Prepare the school's planning budget for September.

Reagen Corporation makes a product with the following standard costs: The company reported the following results concerning this product in December. The materials price variance is recognized when materials are purchased.Variable overhead is applied on the basis of direct labor-hours. Required: a.Compute the materials quantity variance. b.Compute the materials price variance. c.Compute the labor efficiency variance. d.Compute the labor rate variance. e.Compute the variable overhead efficiency variance. f.Compute the variable overhead rate variance.

The amount shown for net operating income in the planning budget for November would have been closest to: