Accounting Exam 3

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Rolling budget

A budget that adds a new month when the current month ends is called a...

Absorption will be greater than variable costing

If production exceeds sales....

Variable will be greater than absorption costing

If sales exceed production...

period expense

In variable costing fixed OH are expensed as what

Static Budget

Prepared 1 time a year for 1 activity level

Absorbtion Costing

Required under GAAP, includes fixed OH

Direct materials, direct labor, and variable sellin and administrative costs

Under absorption costing, which of the following costs would be included in finished goods inventory

wages of machine operators, steel costs for machine tool manufacturer

Under variable costing which of the followig would be included in finished goods inventory

Normal Standards

allow for rest periods, machine breakdowns, and setup time

Variances

differences between actual and standard prices orquantities

Standard cost

expected cost per unit

Ideal Standards

represent optimum levels of performance under perfect operating conditions

Continuous Budget

12 month rolling

Flexible

A series of budgets for varying levels of activity is termed a_____ budget

Direct Costing

Another name for variable costing is

Variable Costing

Does not included fixed OH

Equal units sold

The amount of income under absorption costing will equal the amount of income under variable costing when units manufactured

Sales

The first budget customarily prepared as part of an entitiys master budget is...

Depreciation expense

Which of the following should be ignored when preparing the cash budget

depreciation expense on factory building

Which of the following would be included in the cost of a product manufactured according to absorption costing

Direct materials

Which of the following would be included in the cost of a product manufactured according to variable costing

Wages of factory workers

Which of the following would not be included in a company's selling and administrative expense budget


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