BEC Ratios (Cost Accounting)

Question 1

Prime Costs

Answer 1

DM + DL

Question 2

Conversion Costs

Answer 2

DL + Manufacturing OH

Question 3

Cost of Good Manufactured

Answer 3

DM used + DL incurred + OH applied = cost added to production + beg. WIP inventory - end. WIP inventory = COGM

Question 4

Break Even in Units

Answer 4

fixed cost / Sales Price - VC (CM)

Question 5

Break Even in Sales Dollars

Answer 5

fixed cost / CM Ratio (cm/sales price)

Question 6

Composite Units Sold

Answer 6

total CM / CM per unit

Question 7

Contribution Margin Ratio

Answer 7

(sales - variable costs) / sales

Question 8

Direct Materials Price Variance (DMPV) (Purchasing)

Answer 8

actual quantity purchased x (standard cost per unit - actual cost per unit)

DMPV = AQP x (SC - AC)

Question 9

Direct Materials Usage Variance (DMUV) (Production)

Answer 9

standard cost x (standard quantity allowed - actual quantity used)

DMUV = SC x (SQA - AQU)

Question 10

Direct Labor Rate Variance (DLRV) (Personnel)

Answer 10

actual hours x (standard rate - actual rate)

DLRV = AH x (SR - AR)

Question 11

Direct Labor Efficiency Variance (DLEV) (Production)

Answer 11

standard rate x (standard hours - actual hours)

DLEV = SR x (SH - AH)

Question 12

Overhead Applied (OA)

Answer 12

standard direct labor hours x predetermined OH rate

OA = SDLH x POHR

Question 13

Overhead Spending Variance (OSV)

Answer 13

(actual DL hours x predetermined VOH rate + budgeted fixed OH) - actual OH

OSV = (ALDH x PVOHR + Budgeted FOH - Actual FOH)

Question 14

Overhead Efficiency Variance (OEV)

Answer 14

predetermined VOH x (standard DL hours - actual DL hours)

OEV = PVOH x (SDLH - ADLH)

Question 15

Overhead Production Volume Variance (OVV)

Answer 15

(standard DL hours x predetermined FOHR) - budgeted fixed OH

(SDLH x PFOHR) - Budgeted FOH

Question 16

One Variance Method

Answer 16

Net OH Variance

Question 17

Two Variance Method

Answer 17

Budget (Controllable) / Volume (Non-Controllable)

Question 18

Three Variance Method

Answer 18

Spending / Efficiency / Volume

Question 19

Four Variance Method

Answer 19

Fixed / Variable Spending / Efficiency / Volume

Question 20

Weighted Average Approach

Answer 20

Total Cost / Total Equivalent Units = Cost per Unit

Question 21

FIFO Approach

Answer 21

costs this period / units worked on this period = cost per unit

Question 22

Variable OH Spending Variance

Answer 22

(standard variable OH rate - actual variable OH rate) x actual usage
or
(actual price - standard price) x actual quantity

Question 23

Predetermined OH Rate

Answer 23

estimated total OH costs / est total DLH or other divisors

Question 24

Margin of Safety: excess of sales over break even sales

Answer 24

MS in dollars: total sales in dollars - break even sales in dollars

MS as % of sales: margin of safety in dollars / total sales

Question 25

Variable Cost per Unit

Answer 25

(costs at high - cost at low) = changes in cost

(activities at high - act at low) changes in activities

Question 26

Total Fixed Cost

Answer 26

total cost - (variable cost per unit x activity) = fixed cost

Question 27

OH Rate

Answer 27

estimated annual OH / estimated annual DL

Question 28

Variable OH Efficiency Variance

Answer 28

standard variable OH Rate x ( actual DL hours - budgeted DL hours)

Question 29

Applied Fixed OH Costs

Answer 29

Standard direct-labor hours (DLH) × Fixed overhead rate per DLH

Question 30

Fixed OH Volume Variance (Production Volume Variance)

Answer 30

Budgeted Fixed OH - Applied Fixed OH