In a 2 variance analysis the flexible budget variance

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Fundamentals of Financial Management
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Chapter 21 / Exercise 5C
Fundamentals of Financial Management
Brigham
Expert Verified
137) In a 2-variance analysis the flexible-budget variance and the production-volume variance should be ________, respectively. A) $5,500 U; $55,000 U B) $20,500 U; $40,000 U C) $10,500 U; $50,000 U D) $60,500 U; Zero Answer: Explanation: B) $4,500 F + $10,000 U + $15,000 U = $20,500 U; $40,000 U
B
Diff: 2Terms: total-overhead varianceObjective: 6AACSB: Analytical skills138) In a 1-variance analysis the total overhead variance should be:
B
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Fundamentals of Financial Management
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Chapter 21 / Exercise 5C
Fundamentals of Financial Management
Brigham
Expert Verified
Objective: 6AACSB: Analytical skillsAnswer the following questions using the information below: Munoz, Inc., produces a special line of plastic toy racing cars. Munoz, Inc., produces the cars in batches. To manufacture a batch of the cars, Munoz, Inc., must set up the machines and molds. Setup costs are batch-level costs because they are associated with batches rather than individual units of products. A separate Setup Department is responsible for setting up machines and molds for different styles of car.Setup overhead costs consist of some costs that are variable and some costs that are fixed with respect to the number of setup-hours. The following information pertains to June 2004:ActualStatic-budgetAmountsAmountsUnits produced and sold15,00011,250Batch size (number of units per batch)250225Setup-hours per batch55.25Variable overhead cost per setup-hour$40$38Total fixed setup overhead costs$14,400$14,000139) Calculate the efficiency variance for variable setup overhead costs.
c
Diff: 3Terms: variable overhead efficiency varianceObjective: 7AACSB: Analytical skills140) Calculate the spending variance for variable setup overhead costs.
C
Diff: 3Terms: variable overhead spending varianceObjective: 7AACSB: Analytical skills141) Calculate the flexible-budget variance for variable setup overhead costs. A) $600 favorable
31
B) $1,300 favorable C) $600 unfavorable D) $1,300 unfavorable Answer: Explanation: B) $1,900 (F) + $600 (U) = $1,300 (F)Diff: 3Terms: variable overhead flexible-budget variance
B
Objective: 7AACSB: Analytical skills142) Calculate the spending variance for fixed setup overhead costs.
B
Diff: 3Terms: fixed overhead spending varianceObjective: 7AACSB: Analytical skills143) Calculate the production-volume variance for fixed setup overhead costs.
C
Diff: 3Terms: production-volume varianceObjective: 7AACSB: Analytical skills32

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