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

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Question 81

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Leshem 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 variable overhead rate variance is:

A) $9,184 U
B) $8,528 F
C) $9,184 F
D) $8,528 U

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

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Question 82

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Harris Corporation uses a standard cost system in which it applies manufacturing overhead to units of product on the basis of standard direct labor-hours (DLHs) .The company has provided the following data: The volume variance would be:

A) $2,500 F
B) $1,800 F
C) $1,800 U
D) $1,500 F

E) A) and B)
F) B) and C)

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Question 83

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Hoag Corporation applies manufacturing overhead to products on the basis of standard machine-hours.Budgeted and actual fixed manufacturing overhead costs for the most recent month appear below: The company based its original budget on 2,600 machine-hours.The company actually worked 2,280 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 2,080 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?

Stopher 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 variable component of the predetermined overhead rate is closest to:

Pearlman 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 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 fixed overhead budget variance is:

A company has a standard cost system in which fixed and variable manufacturing overhead costs are applied to products on the basis of direct labor-hours.A fixed manufacturing overhead volume variance will necessarily occur in a month in which the fixed manufacturing overhead applied to units of product on the basis of standard hours allowed differs from the budgeted fixed manufacturing overhead.

Gregorich 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 overhead budget variance is:

Maertz Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The budgeted fixed manufacturing overhead cost for the most recent month was $10,890 and the actual fixed manufacturing overhead cost for the month was $10,540.The company based its original budget on 3,300 machine-hours.The standard hours allowed for the actual output of the month totaled 3,240 machine-hours.What was the overall fixed manufacturing overhead budget variance for the month?

The economic impact of the inability to reach a target denominator level of activity would best be measured by:

The total amount of manufacturing overhead applied is closest to:

Figures 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 labor-hours allowed for the actual output of the period.Data concerning the most recent year appear below: The variable overhead efficiency variance is:

The predetermined overhead rate is closest to:

The manufacturing overhead variance that is a measure of capacity utilization is:

Mcgreal Incorporated has provided the following data concerning its overhead variances for the most recent period: The total of the overhead variances is:

The fixed manufacturing overhead volume variance for the period is closest to:

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

Rodarta Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The company's predetermined overhead rate for fixed manufacturing overhead is $1.20 per machine-hour and the denominator level of activity is 6,600 machine-hours.In the most recent month, the total actual fixed manufacturing overhead was $8,340 and the company actually worked 6,400 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 6,480 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?

Hargett 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.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. e.Determine whether overhead was underapplied or overapplied for the year and by how much.

A volume variance and budget variance are computed for fixed manufacturing overhead costs.