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Exam 9: Flexible Budgets Standard Costs and Variance Analysis

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Question 31

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What is ChocO's materials (milk chocolate) quantity variance?

A) $ 238 Unfavorable
B) $ 476 Unfavorable
C) $ 952 Favorable
D) $1,190 Unfavorable

E) B) and D)
F) B) and C)

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Question 32

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Sherburne Snow Removal's cost formula for its vehicle operating cost is $2,510 per month plus $371 per snow-day.For the month of March, the company planned for activity of 18 snow-days, but the actual level of activity was 17 snow-days.The actual vehicle operating cost for the month was $8,460.The vehicle operating cost in the flexible budget for March would be closest to:

A) $8,817
B) $9,188
C) $8,460
D) $8,678

E) A) and B)
F) None of the above

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Question 33

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The following data for November have been provided by Hunn Corporation, a producer of precision drills for oil exploration: Required: Compute the variable overhead rate variances for indirect labor and for power for November.Indicate whether each of the variances is favorable (F)or unfavorable (U).Show your work!

The variable overhead efficiency variance measures the difference between the actual level of activity and the standard activity allowed for the actual output, multiplied by the variable part of the predetermined overhead rate.

Glaab Inc.has provided the following data concerning one of the products in its standard cost system.Variable manufacturing overhead is applied to products on the basis of direct labor-hours. The company has reported the following actual results for the product for September: Required: a.Compute the materials price variance for September. b.Compute the materials quantity variance for September. c.Compute the labor rate variance for September. d.Compute the labor efficiency variance for September. e.Compute the variable overhead rate variance for September. f.Compute the variable overhead efficiency variance for September.

Last month, Birkner Corporation's actual indirect materials cost, a variable cost, was $30,444 and the spending variance for indirect materials cost was $8,142 favorable.During that month, the company worked 17,700 machine-hours.Budgeted activity for the month had been 18,200 machine-hours.The cost formula per machine-hour for indirect materials cost must have been closest to:

To help assess how well a manager has controlled costs, actual costs should be compared to what the costs should have been for the actual level of activity.

The materials quantity variance is:

The revenue in the company's flexible budget for October would have been closest to:

The labor efficiency variance for January is:

The labor rate variance for July is:

Buckson Framing's cost formula for its supplies cost is $1,350 per month plus $18 per frame.For the month of June, the company planned for activity of 716 frames, but the actual level of activity was 713 frames.The actual supplies cost for the month was $14,820.The supplies cost in the flexible budget for June would be closest to:

Canniff Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports.The cost formula for plane operating costs is $56,560 per month plus $2,618 per flight plus $5 per passenger.The company expected its activity in February to be 63 flights and 254 passengers, but the actual activity was 62 flights and 255 passengers.The actual cost for plane operating costs in February was $218,820.The plane operating costs in the planning budget for February would be closest to:

The variable overhead rate variance for supplies is closest to:

The following labor standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the labor rate variance for the month?

The raw materials price variance for the month is closest to:

The variable overhead efficiency variance for August is:

The direct materials in the flexible budget for November would be closest to:

The facility expenses in the flexible budget for January would be closest to:

Using a flexible budget, actual results can be compared to what costs should have been at the actual level of activity.