T

F

$(1)$ The term budgeted rate and standard rate are considered synonymous.

T $,F$

$(2)$ Fixed costs automatically increase or decrease with the level of actiity within the relevant range.

T $,F$

$(3)$ Possible causes for exceeding budgets are machines were not maintained in good operating condition and$/$or machine time budgeted standards were set too tight.

T F

$(4)$ Production volume variance arises only for fixed costs. It is the difference between the budgeted fixed overhead and the fixed overhead allocated on the basis of actual output produced.

T F

$(5)$ Variable costing is an imprecise term in the sense that only variable manufacturing costs are inventoried, variable non$-$manufacturing costs are still treated as period costs but are not expensed.

T $,F$

$(6)$ The main difference between variable costing and absorption costing is the accounting for variable manufacturing costs.

F $(7)$ Assuming production of units exceeds sales of units the operating income of a variable cost income statement will be lower than the operating income of an absorption costing income statement.