Accounting_203_Chapter_9_Test

Accounting_203_Chapter_9_Test - ACCOUNTING 203 Chapter 9...

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ACCOUNTING 203 Chapter 9 Practice Test True and False Questions 1. With a flexible budget a manager can determine what costs should be attained at a given level of activity. 2. The flexible budget is a dynamic tool, in that a budget can be constructed to compare to any level of actual costs within the relevant range. 3. Fixed costs should never be considered when evaluating how well a manager has controlled costs. 4. The overhead spending variance contains price but not quantity elements. 5. Waste or excessive usage of overhead items will show up as part of the variable overhead efficiency variance. Multiple Choice Questions 6. A static budget: A) should be compared to actual costs to asses how well costs were controlled. B) should be compared to a flexible budget to asses how well costs were controlled. C) is valid for only one level of activity. D) represents the best way to set spending targets for managers. 7. The variable overhead spending variance is most effective in measuring: A) how well overhead spending matches the targets set in the original budget at the beginning of the year. B) the efficency with which the activity base was utilized in production. C) the excessive use of overhead resources. D) the utilization of plant facilities. 8. The higher the denominator level of activity: A) the higher the cost per unit of product. B)
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Accounting_203_Chapter_9_Test - ACCOUNTING 203 Chapter 9...

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