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Overhead Cost Variances and Management Control
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Overhead Cost Variances and Management Control – MCQs
10 questions. Click to practice.
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Correct options are highlighted when revealed.
1.
In standard costing, which type of costs are allocated by multiplying the standard quantity allowed by the predetermined overhead rates?
adjustable expenses
costs that vary with production
indirect manufacturing expenses
constant expenses
2.
Which category do energy, machine maintenance, indirect materials, and engineering support fall under?
variable overhead expenses
fixed overhead expenses
fixed batch expenses
variable batch expenses
3.
In the process of planning which cost type should a company remove all activities that do not contribute value to its products or services?
variable overhead cost
fixed overhead expenses
fixed batch expenses
variable batch expenses
4.
Given a flexible budget of $40,000 and a variable overhead flexible budget variance of $25,000, what is the amount of the actual costs incurred?
$15,000
$35,000
$65,000
$75,000
5.
What is the term for the budget that shows the variance between the actual quantity used and the quantity originally planned?
budget based on actual costs
variance in a flexible budget
static budget
time-based budget
6.
What is the term used to describe the difference between the actual variable overhead cost incurred and the variable overhead amount in the flexible budget?
variable overhead flexible budget variance
fixed overhead budget variance
flexible overhead cost variance
flexible overhead price variance
variable overhead spending variance
7.
Which of the following is considered a cost allocation base utilized by an operations manager?
machine hours
adjustable hours
hours that vary
constant hours
8.
Which costing method calculates direct costs by applying a predetermined price rate to the actual quantity produced?
fixed costing
standard costing
per unit costing
lot costing
variable costing
9.
To determine ____________, the flexible budget figure is combined with the variable overhead flexible budget variance.
incurred manufacturing expenses
incurred variable expenses
incurred fixed expenses
incurred actual expenses
10.
Depreciation on machinery, wages of plant supervisors, and rental expenses for the plant are classified as which type of cost?
fixed cost per batch
variable cost per batch
variable manufacturing overhead
fixed manufacturing overhead
direct material cost
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