8. A company uses four hours of direct labor to produce a product unit. The standard labor cost is $20 per hour. This period the company produced 20,000 units and used 84,160 hours of direct labor at a total cost of $1,599,040. What is its labor rate variance for the period?

a. $83,200F b. $84160U c. $84,160F d. $83,200U

9. Which of the following is not a benefit of budgeting?

a. It forces managers to look to the future b. It plays an important role in communication within the organization c. It serves an important role in motivating and rewarding employees d. It builds a organizational slack

10. Which of the following budgets shows how many units will be produced each period?

a. Sales Budget b. Direct Materials Budget c. Direct Labor Budget d. Production Budget

11. A plan that reports the number of units to expected to be sold during each period is called a: a. Production Budget b. Manufacturing Budget c. Sales Budget d. Cash Budget

12. The sales budget for Modesto Corp. shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units. Budgeted purchases of Product B for the year would be: a. 24,500 units. b. 22,500 units. c. 16,500 units. d. 26,500 units. e. 13. Coomb's Fashions forecasts sales of $125,000 for the quarter ended December 31. Its gross profit rate is 20% of sales, and its September 30 inventory is $32,500. If the December 31 inventory is targeted at $41,500, budgeted purchases for the fourth quarter should be: a. $134,000. b. $109,000. c. $91,500. d. $25,000.