Question

1. Juenemann Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 3,800 tenant-days, but its actual level of activity was 3,770 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December:

Data used in budgeting:

	Fixed element per month	Variable element per tenant-day
Revenue	−	$33.90
Wages and salaries	$2,900	$7.60
Food and supplies	600	13.40
Facility expenses	9,000	4.00
Administrative expenses	7,500	0.30
Total expenses	$20,000	$25.30

Actual results for December:

Revenue	$132,193
Wages and salaries	$32,662
Food and supplies	$48,918
Facility expenses	$23,040
Administrative expenses	$8,931

The spending variance for facility expenses in December would be closest to:

Select one:

a. $1,040 U

b. $1,040 F

c. $1,160 F

d. $1,160 U

2. CVP analysis does not consider

Select one:

a. level of activity.

b. fixed cost per unit.

c. variable cost per unit.

d. sales mix.

3. Dillon has a standard of 2 hours of labor per unit, at $12 per hour. In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970. Dillon's labor quantity variance is

Select one:

a. $770 U.

b. $770 F.

c. $1,800 F.

d. $1,930 F.

4. The direct materials and direct labor budgets provide information for preparing the

Select one:

a. sales budget.

b. production budget.

c. manufacturing overhead budget.

d. cash budget.

5. Which one of the following is not needed in preparing a production budget?

Select one:

a. Budgeted unit sales

b. Budgeted raw materials

c. Beginning finished goods units

d. Ending finished goods units

Answer 1

1)	Spending variance
	actual - flexible budget
	23,040           - (9000+3770*4)
	1,040	F
	answer option b)		1,040 F
2)	option b
	Fixed cost per unit
3)	labor quantity variance
	( actual hours - standard hrs allowed)*standard rate
	(3,850           - 2000*2)*12
	1800	F
	answer )	option c	1800 F
4)	option d)
	cash budget
5)	option b
	budgeted raw materials