A company produces a product that requires two materials, Material A and Material B. Details of the material quantities and costs for August are given in the table below.
Budgeted and actual output of the product for August was 12,000 units.
The material yield variance for August is:
TDM edits, prints and publishes three magazines, Mag A, Mag B and Mag C. The company operates an activity-based costing system.
The following information has been obtained.
What is the overhead cost attributable for each Mag A publication?
Give your answer to the nearest whole cent.
A manufacturing company uses activity-based costing to charge overheads to its three products. One of the main activities is quality inspection. The cost driver is the number of inspections and the budgeted cost is $211,200.
Additional budgeted data.
What is the budgeted quality inspection cost for a unit of product F?
XY can choose from four mutually exclusive projects. The projects will each last for one year and their net cash inflows will be determined by market conditions. The forecast net cash inflows for each of the possible outcomes are shown below.
If the company applies the maximax criterion the project chosen would be:
Which THREE of the following are advantages of activity-based costing (ABC), in a multi-product environment, when compared with traditional absorption costing?
A decision tree is being evaluated back to a decision point.
There are two alternatives at this point:
1. To abandon the project and generate a return of $435,000;
2. To continue with the project and generate the following possible returns:
What value should be included at the decision point?
A company makes a product using two materials, X and Y.
The standard materials required for one unit of the product are:
What is the direct material mix variance for Material X, using the individual valuation basis?
The term ‘budgetary slack’ refers to the:
RST is preparing a quotation, on a relevant cost basis, for a special order.
Which TWO of the following are relevant costs that should be included in the quotation?
A company produces trays of pre-prepared meals that are sold to restaurants and food retailers. Three varieties of meals are sold: economy, premium and deluxe.
Calculate, for the original budget, the budgeted fixed overhead costs, the budgeted variable overhead cost per tray and the budgeted total overheads costs.
