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Accounting Quiz

Accountants are lifelong students. The weekly quizzes are open
to everyone in the wonderful field of accounting, business
and the study of accounting. Good luck!

This week's quiz brought to you by:
Patricia Doherty, Instructor
Boston University



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1 - "Jonny B Company uses a standard cost system in which manufacturing overhead is applied to units of product on the basis of standard direct labor hours. The company's total budgeted variable and fixed manufacturing overhead costs at the denominator level of activity are $14,000 for variable overhead and $6,000 for fixed overhead. The predetermined overhead rate, including both variable and fixed components, is $4 per direct labor hour. The standards call for 2 direct labor hours per unit of output produced. last year, the company produced 3,000 units of product and worked 6,200 direct labor hours. Actual costs were $15,500 for variable overhead and $6,300 for fixed overhead. The denominator level of activity is:"
$4
"$20,000 "
"5,000 DLH"
"6,000 DLH"

2 - Use the information for Jonny B in Question 1. The total standard hours allowed for the output Last year were:
2
"3,000"
"6,200"
"6,000"

3 - Use the information for Jonny B in Question 1. The variable overhead spending variance was:
"$1,860 F"
"$1,860 U"
"$1,500 F"
"$1,500 U"

4 - Use the information for Jonny B in Question 1. The variable overhead efficiency variance was:
$800 U
$560 F
$560 U
$800 F

5 - Use the information for Jonny B in Question 1. The fixed overhead budget variance was:
$0
$300 U
"$1,440 F"
"$1,440 U"

6 - Use the information for Jonny B in Question 1. The fixed overhead volume variance was:
"$1,440 U"
"$1,200 U"
"$1,440 F"
"$1,200 F"

7 - A standard cost is:
The cost you have always paid for something.
A budget for a single unit of product.
Only used in a manufacturing setting.
The difference between what you planned to achieve and what you actually achieved.

8 - "When preparing a flexible budget for variable overhead, the cost formula used is calculated by"
Dividing actual costs by actual units of output.
Dividing actual costs by the master budget units of output.
Dividing the master budget cost by the master budgeted units of output.
Using the master budget total cost.

9 - "When preparing a flexible budget, the amount of fixed cost is"
Equal to the master budget amount.
Calculated by dividing the actual output achieved by the budgeted output and multiplying the result by the master budgeted amount of fixed cost.
Equal to the actual fixed cost incurred.
Fixed costs are not evaluated in a flexible budget report.

10 - The best time to recognize a materials price variance is:
When the materials are actually used in production.
When the completed units are transferred from Work in Process to Finished Goods.
When the purchase order is placed for the materials.
When the materials are received and placed in the Raw Materials Inventory.

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