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Cruise Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a
Cruise Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 6,000 units, are as follows:
Direct materials | $4.00 |
Direct labour | $4.00 |
Variable manufacturing overhead | $3.00 |
Fixed manufacturing overhead | $5.00 |
Total cost | $16.00 |
The fixed overhead costs are avoidable. |
|
- What does a favourable direct materials price variance indicate?
- The actual cost of materials purchased was greater than the standard cost of materials purchased.
- The standard cost of materials purchased was less than the actual cost of materials purchased.
- The standard cost of materials purchased was greater than the actual cost of materials purchased.
- The actual quantity of materials used was less than the standard quantity of materials used for actual production.
- In flexible budgets, costs that remain the same regardless of the output levels within the relevant range are
- allocated costs.
- budgeted costs.
- fixed costs.
- variable costs.
- estimated costs.
- Actual overhead is $698,000, while budgeted overhead is $598,000. What is the fixed overhead static-budget variance if 250,000 units are produced and 170,000 are budgeted?
- $80,000 favourable
- $80,000 unfavourable
- $100,000 favourable
- $102,000 unfavourable
- $100,000 unfavourable
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