Chapter 9
When preparing a cash budget for manufacturing overhead and deprecation expense is included in the overhead cost, how should the deprecation be treated?
Remove the deprecation it is not a cashflow item.
A manager that has responsibility for only expenses and not revenues or assets would be classified as what type of responsibility center?
Cost Center
A labor efficiency would be the responsibility of who?
Production Manager
The primary goal of managerial accouting is to provide information to who?
Internal Management
Sales-Variable Expenses=?
Contribution Margin
What would be the starting point for preparing a comprehensive budget?
Sales Budget (projected number of units sold)
Investigating large or unusual variances is a management practice called
Management by Exception
When calculating the direct materials price variance what is the AQU and the SQA?
AQU Actual Quantity Used
SQA Standard Quanity Allowed
Sales and Marketing costs are what type of costs?
Period Costs
Data that differs between alternatives are
Relevant
If the company starts January with 100 units in beginning inventory how will these units be included in the January production budget?
Subtracted from the production budget
Volume Variances are computed by
Calculating the difference between the Planned Budget (static budget) and the Flexible budget
To determine if the variance is favorable or unfavorable, how did Prof Widdig explain to identify this??
Look inside the parentheses.....
The actual vs standard will be there
Utility Costs for the factory would be classified as
Manufacturing Overhead (Product Cost)
The four cost of quality classifications are
Prevention, appraisal, internal failure, external failure
How would you calculate the direct labor cost for a month for a budget?
Multiply units to be produced x labor time x labor rate
Flexible budget variances are calculated by
Calculating the difference between the Flexible budget and the actual results
Who would be accountable for an unfavorable materials price variance?
Purchasing manager
What is the POHR formula?
Estimated Overhead/Estimated Cost Driver
How is margin of safety calculated?
Expected Sales (or current sales) minus Breakeven Sales
When computing a production budget start with unit sales, add desired ending inventory and subtract ___?
Beginning inventory at the start of the period
What are the four componets of the balanced scorecard?
Internal Business Process
Financial
Leaning and Growth
Customer
How would the SQA be calculated?
Standard quanity per unit x number of units produced
The actual overhead incurred was $400,000, estimated overhead was $375,000, and allocated overhead was $410,000. Was overhead underallocated or overallocated? by how much?
Overhead was overallocated by $10,000
A managment strategy designed to eliminate waste is called
Lean production
Just-in time production
also part of TQM