Question 1

The following information describes production activities of the Central Corp.:
  30,000 units were completed during the year
Budgeted standards for each unit produced:
1/2 lb.of raw material at $4.15 per lb.
10 minutes of direct labor at $12.50 per hour
Compute the direct materials price and quantity and the direct labor rate and efficiency variances.Indicate whether each variance is favorable or unfavorable.

Accepted Answer

The answer of The following information describes production activities of...

Question 2

A company's flexible budget for 60,000 units of production showed sales of $96,000,variable costs of $36,000,and fixed costs of $26,000.What operating income would be expected if the company produces and sells 70,000 units?

Accepted Answer

The answer of A company's flexible budget for 60,000 units...

Question 3

Thomas Co.provides the following fixed budget data for the year:
  Required:
Prepare a flexible budget performance report for the year using the contribution margin format.

Accepted Answer

The answer of Thomas Co.provides the following fixed budget data...

Question 4

Based on predicted production of 25,000 units,Best Co.anticipates $175,000 of fixed costs and $137,500 of variable costs.What are the flexible budget amounts of total costs for 20,000 and 30,000 units?

Accepted Answer

The answer of Based on predicted production of 25,000 units,Best...

Question 5

A product has a sales price of $20.Based on a 15,000-unit production level,the variable costs are $12 per unit and the fixed costs are $6 per unit.Using a flexible budget for an actual production and sales level of 18,000 units,what is the budgeted operating income?

Accepted Answer

The answer of A product has a sales price of...

Question 6

Falcon Company's output for a period was assigned the standard direct labor cost of $17,160.If the company had a favorable direct labor rate variance of $1,000 and an unfavorable direct labor efficiency variance of $275,what was the total actual cost of direct labor incurred during the period?

Accepted Answer

The answer of Falcon Company's output for a period was...

Question 7

Perkins Company provides the following data developed for its master budget:
  Required:
Prepare flexible budgets for sales of 20,000,22,000 and 24,000 units.Use a contribution margin format.

Accepted Answer

The answer of Perkins Company provides the following data developed...

Question 8

Stanton Co.produces and sells two lines of t-shirts,Deluxe and Mega.Stanton provides the following data.Compute the sales price and the sales volume variances for each product.
 $$\begin{array} { l r r r } 
\text {  } & \underline { \text { Budget } } &\underline { \text { actual } }  \
\text { Unit salesprice - Deluxe } \ldots . &\text { \$15 }  &\text { \$16 }\
\text { Unit sales price-Mega } \ldots \ldots & \$ 20 & \$ 19 \
\text { Unit sales-Deluxe } \ldots \ldots \ldots . & 2,400 & 2,500 \
\text { Unit sales-Mega } \ldots \ldots \ldots \ldots . & 2,000 & 1,900
\end{array}$$

Accepted Answer

The answer of Stanton Co.produces and sells two lines of...

Question 9

In producing 700 units of Product CBA last period,Cobalt Company used 5,000 pounds of Material H,costing $34,250.The company has established the standard of using 7.2 pounds of Material H per unit of CBA,at a price of $7.50 per pound.Calculate the materials price and quantity variances associated with producing the 700 units,and indicate whether they are favorable or unfavorable:

Accepted Answer

The answer of In producing 700 units of Product CBA...

Question 10

Big Bend Co.fixed budget for the year is shown below:
  Prepare a flexible budget for Big Bend Co.that shows a detailed budget for its actual sales volume of 42,000 units.Use the contribution margin format.

Accepted Answer

The answer of Big Bend Co.fixed budget for the year...

Question 11

Manatee Corp.has developed standard costs based on a predicted operating level of 352,000 units of production,which is 80% of capacity.Variable overhead is $281,600 at this level of activity,or $0.80 per unit.Fixed overhead is $440,000.The standard costs per unit are:
  Manatee actually produced 330,000 units at 75% of capacity and actual costs for the period were:
  Calculate the following variances and indicate whether each variance is favorable or unfavorable:
(1)Direct labor efficiency variance:
 $__________________
(2)Direct materials price variance:
 $__________________
(3)Controllable overhead variance:
 $__________________

Accepted Answer

The answer of Manatee Corp.has developed standard costs based on...

Question 12

Job #305 was budgeted to require 3.5 hours of labor at $11.00 per hour.However,it was completed in 3 hours by a person who worked for $14.00 per hour.What is the total labor cost variance for Job #305?

Accepted Answer

The answer of Job #305 was budgeted to require 3.5...

Question 13

Jacques Company planned to use 18,000 pounds of material costing $2.50 per pound to make 4,000 units of its product.In actually making 4,000 units,the company used 18,800 pounds that cost $2.54 per pound.Calculate the direct materials price variance.

Accepted Answer

The answer of Jacques Company planned to use 18,000 pounds...

Question 14

Use the following cost information to calculate the direct labor rate and efficiency variances and indicate whether they are favorable or unfavorable.

Accepted Answer

The answer of Use the following cost information to calculate...

Question 15

Duval,Inc.budgets direct materials at $1/liter and each product requires 4 liters per unit of finished product.April's activities show usage of 832 liters to complete 196 units at a cost of $798.72.Compute the direct materials price and quantity variances.Indicate if the variance if favorable or unfavorable.

Accepted Answer

The answer of Duval,Inc.budgets direct materials at $1/liter and each...

Question 16

Fairfield Co.collected the following information about its production activities for the current year.
a.Compute the direct materials price and quantity variances and indicate whether each is favorable or unfavorable.
b.Prepare the journal entry to record the issuance of direct materials into production.
Actual costs and quantities:
Direct materials used 95,000 lbs.@ $6.30 per lb.
Units completed during the year,50,000 units
Standard costs and quantities:
Price per lb.of direct material,$6.05
Two lbs.of direct material per unit

Accepted Answer

The answer of Fairfield Co.collected the following information about its...

Question 17

Elroy Co.has prepared the following fixed budget for the year,assuming production and sales of 30,000 units.This level of production represents 80% of capacity.
  Calculate the following flexible budget amounts at the indicated levels of capacity:

Accepted Answer

The answer of Elroy Co.has prepared the following fixed budget...

Question 18

Jacques Company planned to use 18,000 pounds of material costing $2.50 per pound to make 4,000 units of its product.In actually making 4,000 units,the company used 18,800 pounds that cost $2.54 per pound.Calculate the direct materials quantity variance.

Accepted Answer

The answer of Jacques Company planned to use 18,000 pounds...

Question 19

Casco Co.planned to produce and sell 40,000 units.At that volume level,variable costs are determined to be $320,000 and fixed costs are $30,000.The planned selling price is $10 per unit.Casco actually produced and sold 42,000 units.
Using a contribution margin format:
(a)Prepare a fixed budget income statement for the planned level of sales and production.
(b)Prepare a flexible budget income statement for the actual level of sales and production.

Accepted Answer

The answer of Casco Co.planned to produce and sell 40,000...

Question 20

The following information comes from the records of Dina Co.for the current period.
a.Compute the direct materials price and quantity variances,direct labor rate and efficiency variances and state whether the variance is favorable or unfavorable.
b.Prepare the journal entries to charge direct materials and direct labor costs to goods in process and the materials and labor variances to their proper accounts.
  Factory overhead (based on budgeted production of 24,500 units)
Variable overhead $2.25/direct labor hour
Fixed overhead $1.95/direct labor hour

Accepted Answer

The answer of The following information comes from the records...

Quiz 23: Flexible Budgets and Standard Costs

A company's flexible budget for 60,000 units of production showed sales of $96,000,variable costs of $36,000,and fixed costs of $26,000.What operating income would be expected if the company produces and sells 70,000 units?

Thomas Co.provides the following fixed budget data for the year: Required: Prepare a flexible budget performance report for the year using the contribution margin format.