# The budget for a given cost during a given period was

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Chapter 6 / Exercise 14
Cornerstones of Cost Management
Hansen/Mowen
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28. The budget for a given cost during a given period was P1,600,000. The actualcost for the period was P1,440,000. Considering these facts, it can be said thatthe plant manager has done a better than expected job in controlling the costif:A. The cost is variable and actual production was 90% of budgetedproductionB.The cost is variable and actual production equaled budgeted productionC. The cost is variable and actual production was 80% of budgetedproductionD. The cost is discretionary fixed cost and actual production equaledbudgeted production
29.The budget variance for fixed factory overhead for the normal-volume, practical-capacity, andexpected-activity levels would be the:IncreaseNo effectD.IncreaseDecrease
Volume variance30. You have leased a 5,000-gallon storage tank for P5,000 per month. You stored4,000 gallons of liquid in the tank during the month. The cost of storage wasP1.25 per gallon, rather than P1.00 per gallon based on 5,000 gallon capacity.Therefore, the cost of storing 4,000 gallons was P1,000 more (P.25 x 4,000) intotal than if you had stored 5,000 gallons of liquid in the tank. Which varianceis being described?
31. Favorable fixed overhead volume variance occurs if:A.there is a favorable labor efficiency variance
32. The unfavorable volume variance may be due to all but which of thefollowing factors?
33. How will a favorable volume variance affect net income under each of the followingmethods?C.IncreaseNo effectD.IncreaseDecrease
34. Favorable volume variances may be harmful when:
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Chapter 6 / Exercise 14
Cornerstones of Cost Management
Hansen/Mowen
Expert Verified