1. The master budget of Benedict Company shows that the planned activity level for next year is expected to be 50,000 machine hours. At this level of activity, the following manufacturing overhead costs are expected:

Indirect labor $360,000

Machine supplies 90,000

Indirect materials 105,000

Depreciation on factory building 75,000

Total manufacturing overhead $630,000

A flexible budget for a level of activity of 60,000 machine hours would show total manufacturing overhead costs of

	A.	$741,000.
	B.	$630,000.
	C.	$756,000.
	D.	$780,000.

2. Given below is an excerpt from a management performance report:

	Budget	Actual	Difference
Contribution Margin	$1,000,000	$1,050,000	$50,000
Controllable fixed costs	$500,000	$450,000	$50,000

The manager's overall performance

	A.	is 20% below expectations.
	B.	is 20% above expectations.
	C.	is equal to expectations.
	D.	16.67% below expectations.

3. If an investment center has generated a controllable margin of $75,000 and sales of $300,000, what is the return on investment for the investment center if average operating assets were $500,000 during the period?

	A.	12%
	B.	25%
	C.	15%
	D.	60%

4. Vidmar Company uses flexible budgets. At normal capacity of 8,000 units, budgeted manufacturing overhead is $64,000 variable and $180,000 fixed. If Vidmar had actual overhead costs of $250,000 for 9,000 units produced, what is the difference between actual and budgeted costs?

	A.	$2,000 unfavorable.
	B.	$2,000 favorable.
	C.	$6,000 unfavorable.
	D.	$8,000 favorable.