Cost accounting

The production department should generally be responsible for materials price variances that resulted from:

rush orders arising from poor scheduling.

The usual starting point for a master budget is:

the sales forecast or sales budget.

A favorable labor rate variance indicates that:

the standard rate exceeds the actual rate

Which of the following may appear on a flexible budget performance report?

An unfavorable activity variance, a favorable revenue variance, an unfavorable spending variance all of them.

) Which of the following budgets are prepared before the sales budget? Budgeted Income Statement Direct Labor Budget A) Yes Yes B) Yes No C) No Yes D) No No

D) No, No

When using a flexible budget, a decrease in activity within the relevant range

Decreases total costs.

Variable manufacturing overhead is applied to products on the basis of standard direct labor-hours. If the labor efficiency variance is favorable, the variable overhead efficiency variance will be:

Favorable

A budget that is based on the actual activity of a period is known as a:

Flexible budget

There are various budgets within the master budget. One of these budgets is the production budget. Which of the following BEST describes the production budget?

It is calculated based on the sales on the sales budget and the desired ending inventory.

In a flexible budget, what will happen to fixed costs as the activity level increases?

The fixed cost per unit will decrease.