Which of the following statements is true? Multiple Choice O The spending variance for a fixed expense will equal zero if the actual expense incurred equals the expense expected for the actual level of activity. The spending variance for a fixed expense will be unfavorable if the amount of the expense contained in the flexible budget is greater than the actual amount of the expense. The spending variance for a fixed expense will be unfavorable if the amount of the expense contained in the flexible budget is less than the planned amount of the expense. The spending variance for a fixed expense can be favorable or unfavorable depending on whether the actual

Which of the following statements is true? Multiple Choice O The spending variance for a fixed expense will equal zero if the actual expense incurred equals the expense expected for the actual level of activity. The spending variance for a fixed expense will be unfavorable if the amount of the expense contained in the flexible budget is greater than the actual amount of the expense. The spending variance for a fixed expense will be unfavorable if the amount of the expense contained in the flexible budget is less than the planned amount of the expense. The spending variance for a fixed expense can be favorable or unfavorable depending on whether the actual

Name: Which of the following statements is true?Multiple ChoiceоThe spendin
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: Which of the following statements is true?Multiple ChoiceоThe spending variance for a fixed expense will equal zeroif the actual expense incurred equals the expenseexpected for the actual level of activity.The spending variance for a fixed expense w

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Gauging the Favorableness of Variances When variances occur, they are described as being either…

A: Direct Labor Rate Variance=Budgeted cost for the actual hours worked-Actual cost for the actual…

Q: A favorable activity variance may not indicate good performance because a favorable activity…

A: Favorable activity variance is a term used in project management and cost accounting to describe a…

Q: Sales volume variances are attributable to differences between planned and actual activity volumes,…

A: Sales volume variances are a component of variance analysis used in cost and performance accounting.…

Q: Which of the following is FALSE regarding variances? O A favorable variance, when it occurred, are…

A: The method of costing used to determine deviations is referred to as standard costing. The standard…

Q: When using a standard cost system what term is used to denote that the actual cost is less than the…

A: Standard cost is calculated using estimated amounts. If the actual cost is less than the standard…

Q: When using a standard cost system what term refers to the differences between actual and standard…

A: Difference of actual and standard cost is measured to calculate the variance. The variances of cost…

Q: At the beginning of the year, you estimated the following - Production - 75,000 units Raw Material -…

A: Variance: It is the difference between budgeted and actual expenditures and revenue.

Q: An unfavorable materials quantity variance indicates that: Multiple Choice standard material price…

A: Unfavorable materials quantity variance means materials has been used more than what was estimated.…

Q: Explain why a favorable sales-quantity variance occurs.

A: Explain the reason for the occurrence of favorable sales quantity variance:When actual sales exceed…

Q: The controllable variance measures a. operating results at more than normal capacity b. operating…

A: Standard costs are estimates of the actual costs in a company’s production processThen, the actual…

Q: S1: A budgeted cost for one unit of product may not always be the standard cost of said product. S2:…

A: solution concept Budgeted cost means the cost that is expected to be incurred and planned to be…

Q: Fixed overhead volume variance is a flexible budget variance. O True False

A: Fixed overheads are those indirect costs which will not change with change in activity level. These…

Q: If the material price variance is favorable but the material quantity variance is unfavorable, what…

A: Variance analysis is method of analysis of actual data and budgeted data. This helps an organisation…

Q: 1. What is the activity variance for the revenue? (Indicate the effect of each variance by selecting…

A: Variance analysis is one of the important technique of management accounting analysis, under which…

Q: cost variance

A: Variance analysis plays a key role in the functioning of any company. It lets you identify key areas…

Q: Considering the variance analysis, which of the following statements is true?

A: Variance analysis is the analysis which is the analysis only possible when the company has a…

Q: Variance analysis would be appropriate to measure performance ina. profit centers.b. investment…

A: Variance analysis is a method used in business and financial management to assess and analyze the…

Q: What is the main difference between static and flexible budgets?

A: A budget is a tool that helps the entity to achieve its predetermined objectives through a…

Q: Variance percentage is calculated by dividing the choose your answer... by the choose your answer...

A: Variation refers to the difference i.e. the difference between the current amounts with the budgeted…

Q: Note: Use the minus sign to indicate negative values (when the budgeted amount is greater than the…

A: In the variance analysis, the actual cost incurred, and the standard cost are compared with each…

Q: My totals won't add up for the spending variances?

A: A spending variance is the variance which has been made by the company over the activities on which…

Q: What makes a variance favorable? Give an example of a favorable variance involving materials. What…

A: Variance is the difference in the value of budgeted cost\quantity and the actual cost\quantity. When…

Q: Parallel Enterprises has collected the following data on one of its products. During the period the…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: A flexible budget depicted graphically O differs from a CVP graph in that sales revenue is not…

A: Flexible budget is a type of budget which shows the estimated cost or outcomes at different level of…

Q: When is the direct labor time variance favorable? A. when the actual quantity used is greater than…

A: Direct labor time is the time taken o produce a unit . when the standard time to make a unit is less…

Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

Topic Video

Question

Which of the following statements is true?
Multiple Choice
о
The spending variance for a fixed expense will equal zero
if the actual expense incurred equals the expense
expected for the actual level of activity.
The spending variance for a fixed expense will be
unfavorable if the amount of the expense contained in the
flexible budget is greater than the actual amount of the
expense.
The spending variance for a fixed expense will be
unfavorable if the amount of the expense contained in the
flexible budget is less than the planned amount of the
expense.
The spending variance for a fixed expense can be
favorable or unfavorable depending on whether the actual
expense is greater than or less than the planned expense.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

When is the direcet labor time variance unfavorable? A. when the actual quantity used is greater than the standard quantity B. when the actual quantity used is less than the standard quantity C. when the actual price paid is greater than the standard price D. when the actual price paid is less than the standard price
Please do not give solution in image format thanku
Which one of the following best describes the direct material price variance? O a. The difference between the standard quantity of material used at the standard cost per unit and the actual quantity of material used at the standard direct material cost per unit O b. The difference between the budgeted material cost and direct material cost according to the unflexed budget O c. The difference between the actual direct material cost and direct material cost according to the flexed budget O d. The difference between the actual cost of the material used and the actual quantity of material used at the standard direct material cost per unit O e. The difference between the actual cost of the material used and the standard quantity of material used at the actual direct material cost per unit
Total variable costs are deducted from Total mixed costs to obtain which of these? Group of answer choices Budgeted costs. Mixed costs per unit. Fixed costs per unit. Total fixed costs.
Which one is the correct answer?
a. Direct materials price variance Unfavorable b. Direct materials quantity variance Favorable c. Direct materials cost variance Unfavorable
TaskMaster Enterprises employs a standard cost system in which direct materials inventory is carried at standard cost. TaskMaster has established the following standards for the prime costs of one unit of product. Direct Materials Direct Labor Standard Quantity 8 pounds 0.25 hour Standard Price $ 3.40 per pound $ 11.20 per hour Standard Cost $ 27.20 2.80 $ 30.00 During November, TaskMaster purchased 168,000 pounds of direct materials at a total cost of $588,000. The total factory wages for November were $58,000, 90% of which were for direct labor. TaskMaster manufactured 19,800 units of product during November using 148,500 pounds of direct materials and 5,160 direct labor-hours. Is the direct labor rate variance favorable or unfavorable?
At the beginning of the year, you estimated the following - Production - 75,000 units Raw Material - 270,000 pounds at a cost of $1,026,000 Direct Labor - 187,500 hours at a cost of $4,125,000 Variable Overhead - 135,000 machine hours at a cost of $567,000 Fixed Overhead - $900,000 At the end of year, the actual results were as follows - Production - 73,000 units Raw Material - 265,720 pounds purchased and used at a cost of $1,036,308 Direct Labor - 179,580 hours at a cost of $3,968,718 Variable Overhead - 133,590 machine hours at a cost of $558,406.20 Fixed Overhead - $891,000
Comment on the statement “A favourable variance is always better than an adverse variance” by considering one behavioural issue involved.
If production is more or less than the standard volume, is it possible that no flexible-budget or production-volume variances would exist? Explain.
At the beginning of the year, you estimated the following - Production - 75,000 units Raw Material - 270,000 pounds at a cost of $1,026,000 Direct Labor - 187,500 hours at a cost of $4,125,000 Variable Overhead - 135,000 machine hours at a cost of $567,000 Fixed Overhead - $900,000 At the end of year, the actual results were as follows - Production - 73,000 units Raw Material - 265,720 pounds purchased and used at a cost of $1,036,308 Direct Labor - 179,580 hours at a cost of $3,968,718 Variable Overhead - 133,590 machine hours at a cost of $558,406.20 Fixed Overhead - $891,000