Question

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. Each question is worth 5 points. 1. XYZ Manufacturing Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs) at $5.00 per MH. During the month, the actual total variable manufacturing overhead was $22,540 and the actual level of activity for the period 4,600 MHs. What was the variable overhead rate variance for the month? a) $92 Favorable b) $460 Unfavorable c) $460 Favorable d) $92 Unfavorable e) None of the above 2. All of the following are groups that performance measures are placed into under a balance scorecard approach except? a) Financial b) Customers ack ofth The tmes coded forap c) Creditors d) Learning and Growth e) None of the above 3. All other things being the same, which of the following would increase the residual income? a) Increase in minimum required return b) Decrease in average operating assets c) Decrease in net operating income d) Decrease in sales 4. Last year a company had sales of $400,000, a turnover of 2.4, and a return on investment of 36 %. The company's net operating income for the year was: a) $120,000 b) $144,000 c) $80,000 d) $60,000 contriol over cost e) $345,600 he

Answer 1

1. What was the variable overhead rate variance for the month?

c) $460 Favorable

$22,540 - ($5 x 4,600) = $460 Favorable

2. All of the following are groups that performance measures are placed into under a balance scorecard approach except?

c) Creditors

3. Which of the following would increase the residual income?

b) Decrease in average operating assets

4. The company's net operating income for the year was:

d) $60,000

($400,000/2.4) x 36%