291. A functional-based approach to budgeting compares costs for functional line items such as
a. setups
b. direct materials
c. ordering
d. inspections
292. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budgeted cost per decal? (Round to three decimal places.)
a. $0.468
b. $0.478
c. $0.486
d. $0.487
($11,000 + $550 + $25,000 + $2,500 + $500 + $200 +$900)/85,000 = $0.478 $40,650/85,000 = $0.478
293. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for setups in an activity-based performance report?
a. $50 F
b. $50 U
c. $800 U
d. none of these
Actual $550
Budget 500
Variance $ 50 U
294. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for maintenance in an activity-based performance report?
a. $50 F
b. $50 U
c. $550 U
d. $550 F
Actual $11,500
Budget $11,000 + (5,000 × $0.11) 11,550
Variance $ 50 F
295. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for machining in an activity-based performance report?
a. $50 F
b. $50 U
c. $800 U
d. $800 F
Actual $28,300
Budget $25,000 + (5,000 × $0.50) 27,500
Variance $ 800 U
296. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted maintenance cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $15,000
b. $32,000
c. $47,000
d. $79,000
$15,000 + ($4 × 8,000) = $47,000
297. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted inspection cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $18,750
b. $60,000
c. $66,000
d. $78,750
$60,000 + ($750 × 25) = $78,750
298. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted setup costs if there was production of 50,000 reflectors that will require 8,000 machine hours, 25 batches, and 15,000 purchase orders?
a. $1,000
b. $25,000
c. $8,000,000
d. $15,000,000
25 × $1,000 = $25,000
299. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted purchasing cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $150,000
b. $200,000
c. $100,000
d. none of these
$50,000 + ($10 × 15,000) = $200,000
300. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the machining cost for production of 50,000 reflectors that will require 8,000 machine hours, 25 batches, and 15,000 purchase orders?
a. $47,000
b. $43,000
c. $38,410,000
d. none of these
$35,000 + ($1 × 8,000) = $43,000
a. setups
b. direct materials
c. ordering
d. inspections
292. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budgeted cost per decal? (Round to three decimal places.)
a. $0.468
b. $0.478
c. $0.486
d. $0.487
($11,000 + $550 + $25,000 + $2,500 + $500 + $200 +$900)/85,000 = $0.478 $40,650/85,000 = $0.478
293. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for setups in an activity-based performance report?
a. $50 F
b. $50 U
c. $800 U
d. none of these
Actual $550
Budget 500
Variance $ 50 U
294. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for maintenance in an activity-based performance report?
a. $50 F
b. $50 U
c. $550 U
d. $550 F
Actual $11,500
Budget $11,000 + (5,000 × $0.11) 11,550
Variance $ 50 F
295. Walterboro, Inc., has done a cost analysis for its production of decals. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $11,000 + $0.11 per machine hour
Machining $25,000 + $0.50 per machine hour
Setups $50 per batch
Purchasing $200 + $45 per purchase order
Following are the actual costs of producing 85,000 decals: 5,000 machine hours; 10 batches; 20 purchase orders
Maintenance $11,500
Machining 28,300
Setups 550
Purchasing 1,000
What is the budget variance for machining in an activity-based performance report?
a. $50 F
b. $50 U
c. $800 U
d. $800 F
Actual $28,300
Budget $25,000 + (5,000 × $0.50) 27,500
Variance $ 800 U
296. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted maintenance cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $15,000
b. $32,000
c. $47,000
d. $79,000
$15,000 + ($4 × 8,000) = $47,000
297. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted inspection cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $18,750
b. $60,000
c. $66,000
d. $78,750
$60,000 + ($750 × 25) = $78,750
298. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted setup costs if there was production of 50,000 reflectors that will require 8,000 machine hours, 25 batches, and 15,000 purchase orders?
a. $1,000
b. $25,000
c. $8,000,000
d. $15,000,000
25 × $1,000 = $25,000
299. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the budgeted purchasing cost if there was production of 50,000 reflectors that will require 8,000 machine
hours, 25 batches, and 15,000 purchase orders?
a. $150,000
b. $200,000
c. $100,000
d. none of these
$50,000 + ($10 × 15,000) = $200,000
300. Silver Faces, Inc., has done a cost analysis for its production of reflectors. The following activities and cost drivers have been developed:
Activity Cost Formula
Maintenance $15,000 + $4 per machine hour
Machining $35,000 + $1 per machine hour
Inspection $60,000 + $750 per batch
Setups $1,000 per batch
Purchasing $50,000 + $10 per purchase order
What is the machining cost for production of 50,000 reflectors that will require 8,000 machine hours, 25 batches, and 15,000 purchase orders?
a. $47,000
b. $43,000
c. $38,410,000
d. none of these
$35,000 + ($1 × 8,000) = $43,000
