Accounting for Decision Making & Control
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1. Which of these is true?
a. Budgeted volume = Actual output × units allowed
b. Actual volume = Budgeted output × actual units allowed
c. Expected volume = Standard volume
d. Standard volume = Actual output × # cost driver units allowed: Standard
volume = Actual output × # cost driver units allowed
2. Wendy Wall (WW) makes wall units. For the year, the following details have
been budgeted. Output, 10,000 units; factory overhead $1,250,000, of which
60% is variable. Each wall unit should take 2.5 hours of direct labor to pro-
duce. WW produced 9,500 units with 24,000 DLH used and $1,175,000 actual
overhead was incurred. Overhead is allocated based on direct labor hours
(DLH).What is the correct overhead absorption rate (to nearest cent)?: $50.00
3. Wendy Wall (WW) makes wall units. For the year, the following details
have been budgeted. Output, 10,000 units; factory overhead $1,250,000, of
which 60% is variable. Each wall unit should take 2.5 hours of direct labor
to produce. WW produced 9,500 units with 24,000 DLH used and $1,175,000
actual overhead was incurred. Overhead is allocated based on direct labor
hours (DLH).What is Wendy's total overhead variance?: $12,500 over absorbed
4. Wendy Wall (WW) makes wall units. For the year, the following details
have been budgeted. Output, 10,000 units; factory overhead $1,250,000, of
which 60% is variable. Each wall unit should take 2.5 hours of direct labor
to produce. WW produced 9,500 units with 24,000 DLH used and $1,175,000
actual overhead was incurred. Overhead is allocated based on direct labor
hours (DLH).What is true of Wendy's overhead variances?: Overhead spending
variance is $45,000 fav
5. The overhead volume variance:
a. captures the difference between planned overheads and actual overheads
b. measures underutilized capacity
c. measures the opportunity cost of actual capacity utilization differing from
planned capacity utilization
d. as a performance measure encourages overproduction: as a performance
measure encourages overproduction
6. Karpoff Kremes (KK) planned to sell 40,000 Kings at $20 each and 20,000
Kweens at $15 each. Actual sales of the former were 45,000 and 25,000 of the
latter, at $19 and $16 respectively.Which is true of KK?: The price variance is
$20,000 unfavorable
1/3
Study online at https://quizlet.com/_dvxj0n
1. Which of these is true?
a. Budgeted volume = Actual output × units allowed
b. Actual volume = Budgeted output × actual units allowed
c. Expected volume = Standard volume
d. Standard volume = Actual output × # cost driver units allowed: Standard
volume = Actual output × # cost driver units allowed
2. Wendy Wall (WW) makes wall units. For the year, the following details have
been budgeted. Output, 10,000 units; factory overhead $1,250,000, of which
60% is variable. Each wall unit should take 2.5 hours of direct labor to pro-
duce. WW produced 9,500 units with 24,000 DLH used and $1,175,000 actual
overhead was incurred. Overhead is allocated based on direct labor hours
(DLH).What is the correct overhead absorption rate (to nearest cent)?: $50.00
3. Wendy Wall (WW) makes wall units. For the year, the following details
have been budgeted. Output, 10,000 units; factory overhead $1,250,000, of
which 60% is variable. Each wall unit should take 2.5 hours of direct labor
to produce. WW produced 9,500 units with 24,000 DLH used and $1,175,000
actual overhead was incurred. Overhead is allocated based on direct labor
hours (DLH).What is Wendy's total overhead variance?: $12,500 over absorbed
4. Wendy Wall (WW) makes wall units. For the year, the following details
have been budgeted. Output, 10,000 units; factory overhead $1,250,000, of
which 60% is variable. Each wall unit should take 2.5 hours of direct labor
to produce. WW produced 9,500 units with 24,000 DLH used and $1,175,000
actual overhead was incurred. Overhead is allocated based on direct labor
hours (DLH).What is true of Wendy's overhead variances?: Overhead spending
variance is $45,000 fav
5. The overhead volume variance:
a. captures the difference between planned overheads and actual overheads
b. measures underutilized capacity
c. measures the opportunity cost of actual capacity utilization differing from
planned capacity utilization
d. as a performance measure encourages overproduction: as a performance
measure encourages overproduction
6. Karpoff Kremes (KK) planned to sell 40,000 Kings at $20 each and 20,000
Kweens at $15 each. Actual sales of the former were 45,000 and 25,000 of the
latter, at $19 and $16 respectively.Which is true of KK?: The price variance is
$20,000 unfavorable
1/3
