MA Chpater 11 quiz questions

e. All of these choices are correct.

A variable overhead spending variance can occur because a. prices for individual overhead items have increased. b. prices for individual overhead items have decreased. c. more of an individual overhead item was used than expected. d. less of an individual overhead item was used than expected. e. All of these choices are correct.

a. likely to be small.

Because of the nature of fixed overhead items, the difference between the actual fixed overhead cost and the budgeted fixed overhead is a. likely to be small. b. likely to be large. c. usually a major concern. d. often attributable to labor inefficiency. e. None of these choices are correct.

c. large unfavorable variances.

A firm comparing the actual variable costs of producing 10,000 units with the total variable costs of a static budget based on 9,000 units would probably see a. no variances. b. small favorable variances. c. large unfavorable variances. d. large favorable variances. e. small unfavorable variances.

d. All of these choices are correct.

Activity flexible budgeting makes it possible to a. predict what activity costs will be as activity output changes. b. improve traditional budgetary performance reporting. c. enhance the ability to manage activities. d. All of these choices are correct. e. only "predict what activity costs will be as activity output changes" and "enhance the ability to manage activities".

c. the actual output was less than expected or practical capacity.

An unfavorable volume variance can occur because a. too much finished goods inventory was held. b. the company overproduced. c. the actual output was less than expected or practical capacity. d. the actual output was greater than expected or practical capacity. e. All of these choices are correct.

b. the variable overhead efficiency variance will be favorable.

Because the calculation of both variances is based on direct labor hours, a favorable labor efficiency variance implies that a. the variable overhead spending variance will be unfavorable. b. the variable overhead efficiency variance will be favorable. c. there will be no total overhead efficiency variance. d. the variable overhead efficiency variance will also be unfavorable. e. the variable overhead spending variance will be favorable.

d. flexible budgets.

For performance reporting, it is best to compare actual costs with budgeted costs using a. short-term budgets. b. cash budgets. c. materials purchasing budgets. d. flexible budgets. e. None of these choices are correct.

d. All of these choices are correct.

In a performance report that details the spending and efficiency variances, which of the following columns will be found? a. A cost formula for each item b. A budget for actual hours for each item c. A budget of standard hours for each item d. All of these choices are correct. e. Only "A cost formula for each item" and "A budget for actual hours for each item".

e. None of these choices are correct.

In activity-based budgeting, costs are classified as variable or fixed with respect to a. only the units budgeted. b. only the units produced. c. only the units sold. d. only the direct labor hours. e. None of these choices are correct.

c. both unit-level and nonunit-level drivers

In activity-based budgeting, flexible budget formulas are created using a. only unit-level drivers. b. only nonunit-level drivers. c. both unit-level and nonunit-level drivers. d. only direct labor hours. e. All of these choices are correct.

d. the manufacturing department.

Responsibility for the volume variance usually is assigned to a. the accounting department. b. the receiving department. c. the shipping department. d. the manufacturing department. e. None of these choices are correct.

c. the spending and volume variances.

The total fixed overhead variance can be expressed as the sum of a. the spending and efficiency variances. b. the efficiency and volume variances. c. the spending and volume variances. d. the flexible budget and the volume variances. e. None of these choices are correct.

a. the difference between actual and applied fixed overhead costs.

The total fixed overhead variance is a. the difference between actual and applied fixed overhead costs. b. the difference between budgeted and applied fixed overhead costs. c. the difference between budgeted fixed and variable overhead costs. d. the difference between actual and budgeted fixed overhead costs. e. None of these choices are correct.

c. the spending and efficiency variances.

The total variable overhead variance can be expressed as the sum of a. the efficiency variance and the overapplied total overhead. b. the spending, efficiency, and volume variances. c. the spending and efficiency variances. d. the underapplied variable overhead and the spending variance. e. None of these choices are correct.

a. the actual variable overhead and the applied variable overhead.

The total variable overhead variance is the difference between a. the actual variable overhead and the applied variable overhead. b. the budgeted variable overhead and the applied variable overhead. c. the applied variable overhead and the budgeted total overhead. d. the budgeted variable overhead and the actual variable overhead. e. the applied fixed overhead and the budgeted fixed overhead.

a. at the actual level of activity.

To create a meaningful performance report, actual costs and expected costs should be compared a. at the actual level of activity. b. weekly. c. at the budgeted level of activity. d. at the average level of activity. e. hourly.

e. None of these choices are correct.

To help assess performance, managers should use a. a static budget. b. a continuous budget. c. a capital expenditures budget. d. a static budget. e. None of these choices are correct

d. a before-the-fact flexible budget.

To help deal with uncertainty, managers should use a. an after-the-fact flexible budget. b. a master budget. c. a static budget. d. a before-the-fact flexible budget. e. None of these choices are correct.