Question 8 online answer

Question 8 online answer - True/False 1 Fixed manufacturing...

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True/False 1. Fixed manufacturing overhead is accounted for differently for inventory costing purposes than for planning and control purposes. 2. Utilizing only variable overhead activities that add value while using the related cost drivers efficiently results in effective planning of fixed overhead costs. 3. The variable overhead spending variance is the difference between the actual amount of variable overhead incurred and the budgeted amount allowed for the actual quantity of the variable overhead allocation base used for the actual output units achieved. 4. The output level (production) denominator used to compute a budgeted fixed overhead rate is the preselected output level of the allocation base that is used to set the actual fixed overhead rate for allocating fixed overhead costs to a cost object. 11. Financial data provide information to lower level management about the materiality of their variances, and to upper level management for evaluating performance across departments. 12. Managers find that many non-financial benchmarks provide useless information for their planning and control decisions. 13. Under a standard costing system, the work-in-process account will be kept at standard costs. 14. Without proration, managers could manipulate income by setting lax standards and taking the resulting FAV variances into current income. Multiple Choice 15. The cost of electricity used in the production of stuffed toys would be considered a. an administrative cost. b. a non-value-added cost. c. a value-added cost. d. a period cost. 16. Which of the following would help reduce indirect costs? a. increase the complexity of the production and distribution processes b. replace workers with an automated process c. increase the information gathering processing d. increase the number of products produced 21. A FAV variable manufacturing overhead efficiency variance may be interpreted as meaning which of the following? a. Employees used too much electricity during production. b. Less maintenance was required than expected. c. Excess supplies were used. d. Too much of the cost driver was used.
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22. In flexible budgets, costs that remain the same regardless of the output levels within the relevant range are a. allocated costs. b. budgeted costs. c. fixed costs. d. variable costs. 23. Davis Company produced 20,000 cases of beer. Machinery usage is 1.5 hours per case. Budget outputs are 22,000 cases. What are the required static budget machine-hour inputs and flexible budget machine-hour inputs, respectively? a. 30,000 machine-hours, 33,000 machine-hours b. 33,000 machine-hours, 30,000 machine-hours c. 39,000 machine-hours, 34,000 machine-hours d. 34,000 machine-hours, 39,000 machine-hours 24-25. Regal Company uses a single cost pool for fixed manufacturing overhead. The amount for June 19x1 was budgeted at $500,000; however, the actual amount was $700,000. Actual production for June was 12,500 units, and actual machine- hours were 10,000. Budgeted production included 17,750 units and 12,375 machine-
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This note was uploaded on 10/18/2010 for the course ACCT 7104 taught by Professor Assion during the Spring '10 term at Claremont.

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Question 8 online answer - True/False 1 Fixed manufacturing...

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