T 11computing variances for fixed setup costs under

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__ T __11.Computing variances for fixed setup costs under an ABC system parallels the computation of variances for fixed overhead costs under a non-ABC system.
Multiple Choice Select the best answer to each question. Space is provided for computations after the quantitative questions. __ 1.(CPA) Information on Fire Company’s overhead costs is as follows:
Activate the following button to retrieve the URL to cite or link to this page The total overhead variance is: c. $6,000 unfavorable. d. $7,000 favorable. Total overhead variance = Total overhead incurred − Total overhead allocated ($73,000 + $17,000) − 32,000($2.50 + $0.50) $96,000 = − $6,000 or $6,000 Favorable Actual variable overhead $73,000 Actual fixed overhead $17,000 Budgeted hours allowed for actual output produced 32,000
_ A __ 2.CPA adapted) Geyer Company uses standard costing. For the month of April 2009, total overhead is budgeted at $80,000 based on using 20,000 machine-hours. At standard, each finished unit of output requires 2 machine-hours. The following data are available for April 2011: Actual units of output produced 9,500 Machine-hours used 19,500 Total overhead incurred $79,500 What total amount of variable and fixed overhead should Geyer credit to the Manufacturing Overhead Allocated account for April 2011? Budgeted fixed overhead cost rate per machine-hour $0.50
Homework_Week1_Chapter8 Barbara Carter
__ C __ 3.The following information is for Pappillon Corporation’s variable manufacturing overhead costs last month: favorable flexible-budget variance of $3,000, unfavorable efficiency variance of $2,500. The spending variance is: $3,000 F = VOH spending variance + $2,500 U $3,000 F − ($2,500 U) $3,000 F + $2,500 F = $5,500 F a. $500 favorable. b. $5,500 unfavorable. c. $5,500 favorable. d. none of the above. _ D ___ 4.(CPA) Fawcett Company prepared the following information on its manufacturing operations for VOH flexible-budget variance = VOH spending variance + VOH efficiency variance $3,000 F = VOH spending variance + $2,500 U $3,000 F − ($2,500 U) $3,000 F + $2,500 F = $5,500 F
2010: Static Budget Maximum Capacity Percent of capacity 80% 100% Machine-hours 3,200 4,000 Variable overhead $64,000 $80,000 Fixed overhead $160,000 $160,000 Fawcett operated at 90% of maximum capacity during 2010. Actual manufacturing overhead for 2010 is $252,000. Fawcett uses the 2-variance analysis of manufacturing overhead. The total overhead flexible-budget variance for the year is: b. $0.
c. $18,000 unfavorable. d. $20,000 unfavorable. = $252,000 − ($160,000 + $72,000) = $252,000 − $232,000 = $20,000 U
Homework_Week1_Chapter8 Barbara Carter _ E

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