choose the correct answer 1.ABC Corporation is in the process of preparing its a
ID: 2405058 • Letter: C
Question
choose the correct answer
1.ABC Corporation is in the process of preparing its annual budget. The following beginning and ending raw material inventory levels are planned for the year.
Beginning Inventory
Ending Inventory
Raw material (grams)
5,000 grams
4,000 grams
Each unit of finished goods requires 2 grams of raw material and production of 50,000 units of goods are planned.
How much of the raw material should the company purchase during the year?
A. 99,000 grams
B. 100,000 grams
C. 101,000 grams
D. 109,000 grams
2.. The spending variance is the difference between:
A.The static budget and actual results
B.The static budget and the flexible budget
C.The ideal budget and the static budget
D.The flexible budget and the actual results
3. ABC Company has the following data for December:
Budget
Actual
Number of Client Visits
3,500 visits
3,480 visits
Fixed element
per month
Variable element
per client visit
Total
Revenue
—
$35.50
$124,700
Personnel expenses
$27,500
$11.50
$72,050
Administrative expenses
$18,500
$6.60
$45,515
Total expenses
$46,000
$18.10
$117,565
The activity variance for net operating income in December would be closest to:
A.348 F
B.348 U
C.7,765 F
D.7,765 U
4. The following labor standards have been established for a particular product:
Standard labor-hours per unit of output 3 hours
Standard labor rate $15 per hour
The following data pertain to operations concerning the product for the last month:
Actual hours worked 6,500 hours
Actual total labor cost $96,200
Actual output 2,000 units
What is the labor rate variance for the month?
A. $7,400 U
B. $7,400 F
C. $6,200 U
D. $1,300 F
Beginning Inventory
Ending Inventory
Raw material (grams)
5,000 grams
4,000 grams
Explanation / Answer
1 Raw materials to be purchased during the year =(50000*2)+4000-5000= 99000 grams Option A is correct 2 The spending variance is the difference between The flexible budget and the actual results Option D is correct 3 Net operating income planning budget = 3500*(35.5-18.1)-46000= $14900 Net operating income flexible budget = 3480*(35.5-18.1)-46000= $14552 Activity variance for net operating income = 14900-14552 = $348 U Option B is correct 4 Labor rate variance = 96200-(6500*15)= $1300 F Option D is correct
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.