64) A machine distributor sells two models, basic and deluxe. The following information relates
to its master budget.
Basic Deluxe
Sales (units) 8,000 2,000
Sales price per unit $ 8,000 $ 12,000
Variable costs per unit $ 6,400 $ 9,000
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the
same as the budgeted sales prices for both models.
What is the sales mix variance for the deluxe model?
A) $1,176,000.
B) $1,344,000.
C) $2,400,000.
D) $2,520,000.
65) A machine distributor sells two models, basic and deluxe. The following information relates
to its master budget.
Basic Deluxe
Sales (units) 8,000 2,000
Sales price per unit $ 8,000 $ 12,000
Variable costs per unit $ 6,400 $ 9,000
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the
same as the budgeted sales prices for both models.
Is the sales mix variance for the deluxe model favorable or unfavorable?
A) Favorable.
B) Unfavorable.
66) A machine distributor sells two models, basic and deluxe. The following information relates
to its master budget.
Basic Deluxe
Sales (units) 8,000 2,000
Sales price per unit $ 8,000 $ 12,000
Variable costs per unit $ 6,400 $ 9,000
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the
same as the budgeted sales prices for both models.
What is the sales quantity variance for the deluxe model?
A) $120,000.
B) $256,000.
C) $1,344,000.
D) $1,600,000.
67) A machine distributor sells two models, basic and deluxe. The following information relates
to its master budget.
Basic Deluxe
Sales (units) 8,000 2,000
Sales price per unit $ 8,000 $ 12,000
Variable costs per unit $ 6,400 $ 9,000
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the
same as the budgeted sales prices for both models.
Is the sales quantity variance for the basic model favorable or unfavorable?
A) Favorable.
B) Unfavorable.
68) The Vargas Company had the following expectations for the year:
Budgeted results for the year were:
Total market for the product 175,000 units
Vargas’ budgeted sales $ 1,763,125
Variable costs per unit $ 18.75
Selling price per unit $ 32.50
Actual results for the year were:
Total market for the product 166,250 units
Vargas’s actual sales 56,525
Total Variable costs $ 1,073,975
Total sales $ 1,752,275
What is Vargas’ industry volume variance?
A) $37,296.88.
B) $40,906.25.
C) $35,700.00.
D) $32,550.00.
69) The Vargas Company had the following expectations for the year:
Budgeted results for the year were:
Total market for the product 175,000 units
Vargas’s budgeted sales $ 1,763,125
Variable costs per unit $ 18.75
Selling price per unit $ 32.50
Actual results for the year were:
Total market for the product 166,250 units
Vargas’s actual sales 56,525 units
Total Variable costs $ 1,073,975
Total sales $ 1,752,275
Is the industry volume variance favorable or unfavorable?
A) Unfavorable.
B) Favorable.
70) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
What is the total sales price variance?
A) $22,203.50.
B) $28,442.50.
C) $50,646.50.
D) $79,088.50.
71) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
Is the total sales price variance favorable or unfavorable?
A) Favorable.
B) Unfavorable.
72) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
What is the total sales mix variance?
A) $12,478.00.
B) $20,815.00.
C) $33,915.00.
D) $40,553.50.
73) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
Is the total sales mix variance favorable or unfavorable?
A) Favorable.
B) Unfavorable.
74) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
What is the total sales quantity variance?
A) $3,570.00.
B) $20,815.00.
C) $33,915.00.
D) $40,553.50.
75) The next year’s budget for Trend, Inc., a multi-product company, is given below:
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the effects its
sales variances have on the profitability of the company.
Product Lines Units Sales
A 253,230 $ 1,848,579
B 113,770 $ 1,479,010
Is the total sales quantity variance favorable or unfavorable?
A) Favorable
B) Unfavorable
76) A manufacturer of industrial equipment has a standard costing system based on standard
direct labor-hours (DLHs) as the measure of activity. Data from the company’s flexible budget
for manufacturing overhead are given below:
Level of activity 2,500 DLHs
Overhead costs at the denominator activity level:
Variable overhead cost $ 8,500
Fixed overhead cost $ 34,625
The following data pertain to operations for the most recent period:
Actual hours 2,600 DLHs
Standard hours allowed for the actual output 2,592 DLHs
Actual total variable manufacturing overhead cost $ 9,100
Actual total fixed manufacturing overhead cost $ 35,025
What is the predetermined overhead rate to the nearest cent?
A) $16.97.
B) $17.25.
C) $16.59.
D) $17.65.
77) A manufacturer of industrial equipment has a standard costing system based on standard
direct labor-hours (DLHs) as the measure of activity. Data from the company’s flexible budget
for manufacturing overhead are given below:
Level of activity 2,500 DLHs
Overhead costs at the denominator activity level:
Variable overhead cost $ 8,500
Fixed overhead cost $ 34,625
The following data pertain to operations for the most recent period:
Actual hours 2,600 DLHs
Standard hours allowed for the actual output 2,592 DLHs
Actual total variable manufacturing overhead cost $ 9,100
Actual total fixed manufacturing overhead cost $ 35,025
How much overhead was applied to products during the period to the nearest dollar?
A) $44,712.
B) $44,125.
C) $43,125.
D) $44,850.
78) The labor yield variance is actual total hours at:
A) actual mix times actual labor rates less actual total hours at actual mix times standard labor
rates.
B) actual mix times standard labor rates less standard total hours at standard mix times standard
labor rates.
C) actual mix times standard labor rates less actual total hours at standard mix times standard
labor rates.
D) standard mix times standard labor rates less standard total hours at standard mix times
standard labor rates.
79) The labor mix variance is actual total hours at:
A) actual mix times actual labor rates less actual total hours at actual mix times standard labor
rates.
B) actual mix times standard labor rates less standard total hours at standard mix times standard
labor rates.
C) actual mix times standard labor rates less actual total hours at standard mix times standard
labor rates.
D) standard mix times standard labor rates less standard total hours at standard mix times
standard labor rates.
80) The computation of the material yield variance does not require the:
A) standard material mix.
B) standard material price.
C) standard output units.
D) total material actually acquired.
81) A credit balance in the labor yield variance implies:
A) the total units produced was greater than the expected number of units given the total labor
hours actually used.
B) the total units produced was less than the expected number of units given the total labor hours
actually used.
C) the total units produced was greater than the expected number of units given the total standard
hours allowed.
D) the total units produced was less than the expected number of units given the total standard
hours allowed.
82) What is the correct journal entry to record a favorable materials mix variance assuming all
material variances are recognized when the direct materials are issued to production?
A)
Work in Process Inventory XXX
Direct Materials Mix Variance XXX
Direct Materials Inventory XXX
B)
Work in Process Inventory XXX
Direct Materials Mix Variance XXX
Direct Materials Inventory XXX
C)
Finished Goods Inventory XXX
Direct Materials Mix Variance XXX
Work in Process Inventory XXX
D)
Finished Goods Inventory XXX
Direct Materials Mix Variance XXX
Work in Process Inventory XXX
83) What is the correct journal entry to record direct labor when the actual labor mix is favorable
and the total standard hours allowed is greater than the total actual hours worked?
A)
Work in Process Inventory XXX
Direct labor yield variance XXX
Direct labor mix variance XXX
Wages Payable XXX
B)
Work in Process Inventory XXX
Direct labor yield variance XXX
Direct labor mix variance XXX
Wages Payable XXX
C)
Finished Goods Inventory XXX
Direct labor mix variance XXX
Direct labor yield variance XXX
Work in Process Inventory XXX
D)
Finished Goods Inventory XXX
Direct labor yield variance XXX
Direct labor mix variance XXX
Work in Process Inventory XXX
84) The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X Y
Price per pound $ 6 $ 9
Pounds per unit of product Z 10 5
In May, 21,000 units of Z were produced by Shum Company, with the following actual prices
and quantities of materials used:
X Y
Price per pound $ 5.70 $ 8.40
Pounds used 216,000 114,000
What is the total direct materials mix variance for May?
A) $12,000.
B) $24,000.
C) $36,000.
D) $60,000.
85) The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X Y
Price per pound $ 6 $ 9
Pounds per unit of product Z 10 5
In May, 21,000 units of Z were produced by Shum Company, with the following actual prices
and quantities of materials used:
X Y
Price per pound $ 5.70 $ 8.40
Pounds used 216,000 114,000
Is the total direct materials mix variance favorable or unfavorable?
A) Favorable.
B) Unfavorable.