Budgeted Fixed Manufacturing Overhead Rate: The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated. Production Volume Variance: The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity. The effect of production-volume variance on T’s operating income in 2015.

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Answer 1

Question

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

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Answer 2

Question

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Expert Solution & Answer

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Answer 3

Question

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Expert Solution & Answer

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Answer 4

Question

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Expert Solution & Answer

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Answer 5

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Answer 6

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

Answer 7

Chapter 9, Problem 9.40P

1.

To determine

Budgeted Fixed Manufacturing Overhead Rate:

The budgeted fixed manufacturing overhead rate is that rate at which the total budgeted fixed overhead costs are allocated.

Production Volume Variance:

The production volume variance is the difference between the budgeted amount of fixed overhead costs and the fixed overhead cost allocated for the actual output. The positive production volume variance shows under-utilization of capacity and the negative production variance shows the over-utilization of capacity.

The effect of production-volume variance on T’s operating income in 2015.

Answer 8

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

Answer 9

2.

To determine

To explain: The reason because of which controllers deliberately overestimate their future meal counts.

Answer 10

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

Answer 11

3.

To determine

The other evidence that the T’s president seeks to investigate S’s concerns.

Answer 12

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Answer 13

4.

To determine

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

Answer 14

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Answer 15

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Answer 16

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Answer 17

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To explain: The reason because of which controllers deliberately overestimate their future meal counts.

The other evidence that the T’s president seeks to investigate S’s concerns.

The two specific steps that S may take to reduce the hospital controller’s incentives to inflate their estimated meal counts.

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Chapter 9 Solutions