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Exam 13: Budgeting and Standard Costs

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Question 61

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The _____ is an integrated set of operating, investing, and financing budgets for a period of time.

A) standard budget
B) budget performance report
C) zero-based budget
D) master budget

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

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Question 62

Multiple Choice

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Based on the following information, calculate the overall process yield.? ? Process M: Units passing inspection $\quad$ 7,755 units Units entering process $\quad$ 11,750 units Process N: Units passing inspection $\quad 5,762$ units Units entering process $\quad 6,700$ units

A) 80.93%
B) ?60.82%
C) ?66.00%
D) ?56.76%

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

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Question 63

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Nyt Garments Co.'s static budget at 10,000 units of production includes $30,000 for direct material and $5,000 for electric power.Total fixed costs are $31,000.At 12,000 units of production, a flexible budget would show:

Benjamin Corporation began its operations on September 1 of the current year.Budgeted sales for the first three months of business are $250,000, $300,000, and $420,000, respectively, for September, October, and November.The company expects to sell 20% of its merchandise for cash.Of sales on account, 70% are expected to be collected in the month of the sale, 25% in the month following the sale, and the remainder in the following month. The cash collections from accounts receivable in October are:

In most businesses, cost standards are established principally by accountants.

The sales budget is the starting point for preparation of the direct labor cost budget.

If the expected sales volume for the current period is 25,000 units, the desired ending inventory is 700 units, and the beginning inventory is 450 units, the number of units set forth in the production budget, representing total production for the current period, is:

Goal conflict can be avoided if budget goals are carefully designed for consistency across all areas of the organization.

Employees view budgeting more positively when goals are established for them by senior management.

In preparing flexible budgets, the first step is to identify the fixed and variable components of the various costs and expenses being budgeted.

The difference between the actual amount of variable factory overhead cost incurred and the amount of variable factory overhead budgeted for the standard product is termed as variable factory overhead controllable variance.

A _____ shows the expected results of a responsibility center for only one activity level.

​In computing _____, output is measured as the percentage of units from a process that pass inspection.

An unfavorable volume variance may be due to a failure of supervisors to maintain an even flow of work.

The standard costs and actual costs for direct materials, direct labor, and factory overhead for the manufacture of 2,500 units of product are as follows: $\text { Standard Costs }$ $\begin{array}{ll}\text { Direct materials } & 2,500 \text { kilograms } @ \$ 8 \\\text { Direct labor } & 7,500 \text { hours } @ \$ 12\end{array}$ $\underline{\text {Actual Costs}}$ $\begin{array}{ll}\text { Direct materials } & 2,600 \text { kilograms } @ \$ 8.75 \\\text { Direct labor } & 7,400 \text { hours } @ \$ 11.40\end{array}$ Factory overhead (100% capacity - 10,000 hrs.) : Variable cost @ $2 per hour Total variable cost, $18,000 Fixed cost @ $0.80 per hour Total fixed cost, $8,000 The amount of the fixed factory overhead volume variance is:

Benjamin Corporation began its operations on September 1 of the current year.Budgeted sales for the first three months of business are $250,000, $300,000, and $420,000, respectively, for September, October, and November.The company expects to sell 20% of its merchandise for cash.Of sales on account, 70% are expected to be collected in the month of the sale, 25% in the month following the sale, and the remainder in the following month. The cash collections from accounts receivable in November are:

Which of the following formula is used to calculate direct labor rate variance?

The _____ estimates the number of units to be manufactured to meet budgeted sales and desired inventory levels.

Which of the following is true of standards?

The _____ budget shows the expected results of a responsibility center for several activity levels.