Question : 6) The budgeted indirect-cost rate for each cost pool computed : 1212077

6) The budgeted indirect-cost rate for each cost pool is computed as ________.

A) budgeted annual indirect costs divided by budgeted annual quantity of cost allocation base

B) budgeted annual quantity of cost allocation base divided by budgeted annual indirect costs

C) actual annual indirect costs divided by budgeted annual quantity of cost allocation base

D) budgeted annual indirect costs divided by budgeted actual quantity of cost allocation base

7) If indirect-cost rates are calculated monthly, distortions might occur because of ________.

A) rental costs paid monthly

B) property tax payments made in July and December

C) routine monthly preventive-maintenance costs that benefit future months

D) salary hikes at the beginning of the financial year

8) Bernard Company’s budgeted manufacturing overhead is $3,300,000. Overhead is allocated on the basis of direct labor hours. The budgeted direct labor hours for the period are 60,000. What is the manufacturing overhead rate?

A) $47.00

B) $56.00

C) $75.00

D) $55.00

9) Vision Enterprises manufactures digital video equipment. For each unit, $3,000 of direct material is used and there is $2,000 of direct manufacturing labor at $20 per hour. Manufacturing overhead is applied at $25 per direct manufacturing labor hour. Calculate the profit earned on 50 units if each unit sells for $9,000.

A) $65,000

B) $80,000

C) $75,000

D) $2,500

10) In a job-costing system, a manufacturing firm typically uses an indirect-cost rate to estimate the ________ allocated to a job.

A) direct materials

B) direct labor

C) manufacturing overhead costs

D) total costs

11) A job-cost sheet details the ________.

A) direct materials purchased and paid

B) direct labor costs incurred

C) indirect labor costs incurred

D) actual indirect overhead costs incurred

12) A job-cost record uses information from ________.

A) a materials-requisition record to record raw material purchases from suppliers

B) a materials-requisition report to record the type and quantity of item received in an order from a supplier

C) a labor-time card to record an employee’s wage rate and hours spent on a particular job

D) the bill of materials to ensure the goods are of the prescribed quality

13) Costs that are subject to short-run fluctuations for given jobs are ________.

A) actual costs

B) budgeted direct costs

C) budgeted indirect costs

D) normal costs

14) An increase in direct labor cost per unit ________.

A) increases the fixed cost

B) increases profits

C) increases the variable cost

D) increases overhead costs

15) Fixed costs remain constant at $400,000 per month. During high-output months variable costs are $320,000, and during low-output months variable costs are $80,000. What are the respective high and low indirect-cost rates if budgeted professional labor-hours are 16,000 for high-output months and 4,000 for low-output months?

A) $45.00 per hour; $120.00 per hour

B) $45.00 per hour; $45.00 per hour

C) $25.00 per hour; $20.00 per hour

D) $56.20 per hour; $120.00 per hour