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Exam 21: Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

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Question 51

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(Appendix 11A)A company has a standard cost system in which fixed and variable manufacturing overhead costs are applied to products on the basis of direct labor-hours.A fixed manufacturing overhead volume variance will NOT necessarily occur in a month in which there is a fixed manufacturing overhead budget variance.

A) True
B) False

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Question 52

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(Appendix 11A) The Dillon Corporation makes and sells a single product.Overhead costs are applied on the basis of standard direct labor-hours.The standard cost card shows that 5 direct labor-hours are required per unit.The Dillon Corporation had the following budgeted and actual data for March: The fixed manufacturing overhead budget variance for March is:

A) $900 F
B) $3, 900 F
C) $3, 000 U
D) $7, 750 F

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

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Question 53

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(Appendix 11A) A manufacturer of playground equipment uses a standard costing system in which standard machine-hours (MHs) is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead applied to products during the period is closest to:

(Appendix 11A) Tropiano Electronics Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs) .The company had budgeted its fixed manufacturing overhead cost at $62, 100 for the month and its level of activity at 3, 200 MHs.The actual total fixed manufacturing overhead was $61, 600 for the month and the actual level of activity was 3, 000 MHs.What was the fixed manufacturing overhead budget variance for the month to the nearest dollar?

(Appendix 11A) A manufacturer of playground equipment uses a standard costing system in which standard machine-hours (MHs) is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead volume variance for the period is closest to:

(Appendix 11A) Pohl Corporation uses a standard cost system in which manufacturing overhead is applied on the basis of standard machine-hours.For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20, 000 machine-hours: During June, 17, 000 machine-hours were used to complete 13, 000 units of product, and the following actual total overhead costs were incurred: At standard, each unit of finished product requires 1.4 hours of machine time. The variable overhead rate variance for maintenance cost for June was:

(Appendix 11A)Pierce Corporation uses a standard cost system in which it applies manufacturing overhead to its product on the basis of standard direct labor-hours (DLHs).Below is the standard cost card for the product: Last year, the company produced 6, 000 units of product using 17, 000 direct labor-hours.The actual total fixed manufacturing overhead cost for the year was $140, 000 and the volume variance was $12, 000, favorable. Required: a.Determine the budgeted amount of total fixed manufacturing overhead cost. b.Determine the denominator activity figure that the company used in computing predetermined overhead rates.

(Appendix 11A) A manufacturer of playground equipment uses a standard costing system in which standard machine-hours (MHs) is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The predetermined fixed manufacturing overhead rate is closest to:

(Appendix 11A) Dori Castings is a job order shop that uses a standard cost system.Manufacturing overhead costs are applied on the basis of standard direct labor-hours.A volume variance will exist for Dori in a month where:

When computing standard cost variances, the difference between actual and standard price multiplied by actual quantity yields a(n) :

(Appendix 11A) The following data for February has been provided by Gillard Corporation. The volume variance for February is:

(Appendix 11A)A favorable volume variance means that the company operated at an activity level greater than that planned for the period.

(Appendix 11A) Bruley Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The company's predetermined overhead rate for fixed manufacturing overhead is $3.30 per machine-hour and the denominator level of activity is 3, 500 machine-hours.In the most recent month, the total actual fixed manufacturing overhead was $11, 570 and the company actually worked 3, 430 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 3, 450 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?

(Appendix 11A) A manufacturing company uses a standard costing system in which standard machine-hours (MHs) is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead volume variance for the period is closest to:

(Appendix 11A) Derf Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours.Two direct labor-hours are required for each unit produced.The denominator activity was set at 9, 000 units.Manufacturing overhead was budgeted at $135, 000 for the period;20 percent of this cost was fixed.The 17, 200 hours worked during the period resulted in production of 8, 500 units.Variable manufacturing overhead cost incurred was $108, 500 and fixed manufacturing overhead cost was $28, 000. The fixed manufacturing overhead volume variance for the period was:

(Appendix 11A) A furniture manufacturer uses a standard costing system in which standard machine-hours (MHs) is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The overhead applied to products during the period was closest to:

(Appendix 11A) Saffold Corporation has provided the following data for December. The volume variance for December is:

(Appendix 11A) Derf Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours.Two direct labor-hours are required for each unit produced.The denominator activity was set at 9, 000 units.Manufacturing overhead was budgeted at $135, 000 for the period;20 percent of this cost was fixed.The 17, 200 hours worked during the period resulted in production of 8, 500 units.Variable manufacturing overhead cost incurred was $108, 500 and fixed manufacturing overhead cost was $28, 000. The fixed manufacturing overhead budget variance for the period was:

(Appendix 11A) Odonell Corporation estimates that its variable manufacturing overhead is $11.20 per machine-hour and its fixed manufacturing overhead is $563, 640 per period. If the denominator level of activity is 6, 000 machine-hours, the variable component in the predetermined overhead rate would be:

(Appendix 11A) The Murray Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours (DLHs) .The company recorded the following activity and cost data for May: The amount of fixed manufacturing overhead cost that was used to compute the fixed component of the predetermined overhead rate was: