In a cost report, if budgeted wages cost exceeded actual wages cost: a) the difference is sent to the cost of sales. b) an unfavourable difference results. c) the difference is sent to the cash budget. d) a favourable difference results.

Instead of making canopies for their trailers Ajay Metal Workers have the opportunity to purchase them in sufficient quantities at $100 per canopy. Currently Ajay Metal Workers makes the canopies for 300 trailers per year at the following costs: Material $40 Direct Labour $30 Variable overhead $20 Fixed overhead $25 A saving of 20% of fixed overhead would occur if the components were bought in. Should the component be bought in, and why? a) No, increased cost of $5 per canopy. b) No, increased cost of $10 per canopy. c) Yes, cost savings of $5 per canopy. d) Yes, cost savings of $10 per canopy.

An item that is a cash payment in the current period and an expense of the next period is: a) a prepaid expense. b) not adjusted. c) an accrued expense. d) accrued revenue.