Exam 3

Question 1

Revenue Effect of Growth Component

Answer 1

(Actual Units sold in b - Actual Units sold in a) * a’s selling price

Question 2

Cost Effect of Growth Component for VARIABLE COSTS

Answer 2

(Units of input required to produce b output in a - Actual Units of input in a) * a’s input price

Question 3

Revenue Effect of Price Recovery Component

Answer 3

(Selling price in b - Selling price in a) * Actual Units sold in b

Question 4

Cost Effect of Price Recovery Component for VARIABLE COSTS

Answer 4

(Input price in b - Input price in a) * Units of input require to produce b’s output in a.

Question 5

Cost Effect of Price Recovery Component for FIXED COSTS

Answer 5

(Price per unit of capacity in b. - Price per unit of capacity in a) * Actual Units of capacity in a

Question 6

Cost Effect of Productivity Component for VARIABLE COSTS

Answer 6

(Actual units of input for b - Units of input required to produce b’s output in a) * b’s input price

Question 7

Cost Effect of Productivity Component for FIXED COSTS

Answer 7

(Actual units of capacity in b. - Actual Units of capacity in a) * Price per unit of capacity in b

Question 8

Production-volume Variance (for Fixed Overhead costs)

Answer 8

BUDGETED fixed MoH - Fixed MoH allocated using BUDGETED cost per input allowed for ACTUAL output produced

Question 9

JE for DM PRICE variance (when DM is purchased)

Answer 9

DR: DM Control (ACTUAL units purchased @ STRD price)
CR: A/P, Cash, ect

DR/CR: Price Variance depending on if it’s F/U

Question 10

JE for DM EFFICIENCY variance (when DM is put into production)

Answer 10

DR: WIP (ACTUAL units produced @ STRD input rate @ STRD price)
CR: DM Control

DR/CR: Efficiency Variance depending on if it’s F/U

Question 11

JE for Manufacturing Labor Price AND Efficiency variances

Answer 11

DR: WIP (STRD rate for ACTUAL amt of output @ STRD price)
CR: Wages Payable, Cash, ect.

DR/CR: Manufacturing Labor Price & Efficiency variances depending on if they are F/U

Question 12

Price Variance for Direct Costs

Answer 12

(ACTUAL price - BUDGETED price) * ACTUAL amount of input PURCHASED (for DM) / USED (for Labor)
OR
Actual Results - Actual Qty @ Budgeted Price

Question 13

Efficiency Variance for Direct Costs

Answer 13

(ACTUAL input USED - BUDGETED input USED for ACTUAL units produced) * BUDGETED price
OR
Actual Qty @ Budgeted Price - Flexible Budget

Question 14

Measures of Financial Perspective on Balance Scorecard

Answer 14

Revenue, Market share, CM %, ROI, Residual Income, Price/Earnings Ratio

Question 15

Measures of Internal Business Process Perspective on Balance Scorecard

Answer 15

Innovation, Operations, post sales, Managing capacity, Material, labor and OH variances, Reducing non-value added activities (waste, rejects), Turn around time

Question 16

Measures of Customer Perspective on Balance Scorecard

Answer 16

Customer surveys after receiving service, Repeat customers, “Closure” rate, Market share, Referrals

Question 17

Measures of Learning and Growth Perspective on Balance Scorecard

Answer 17

HR, Patents, Certifications, Turnover rates, Employee surveys, Training hours

Question 18

Flexible Budget Variance

Answer 18

Actual Result - Flexible Budget amt

Question 19

Sales-volume Variance

Answer 19

(ACTUAL qty - BUDGETED qty) * BUDGETED price
OR
Flexible Budget - Static Budget

Question 20

Variable Overhead Efficiency Variance

Answer 20

(ACTUAL variable OH used for actual output - BUDGETED variable OH used for actual output) * BUDGETED cost

Question 21

Variable Overhead Spending Variance

Answer 21

(ACTUAL cost - BUDGETED cost) * ACTUAL qty of variable overhead used for actual output

Question 22

Fixed Overhead Spending Variance

Answer 22

ACTUAL costs - FLEXIBLE-budget amt