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Helping Hand Questions for P1

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Question 36

Which of the following would cause an adverse fixed overhead volume variance?

Options:

A.

Actual output was higher than budgeted

B.

Actual output was lower than budgeted

C.

Actual expenditure was higher than budgeted

D.

Actual expenditure was lower than budgeted

Question 37

A special contract requires 640 units of component T.

The inventory of 280 units of component T cost $0.20 per unit but the component is not currently used by the company.

The current market price of component T is $0.24 per unit but the inventory could be sold for $0.15 per unit.

The relevant cost of the units of component T required for the special contract is:

Options:

A.

$100.40

B.

$128.40

C.

$142.40

D.

$153.60

Question 38

TP makes wedding cakes that are sold to specialist retail outlets which decorate the cakes according to the customers’ specific requirements. The standard cost per unit of its most popular cake is as follows:

The general market prices at the time of purchase for Ingredient A and Ingredient B were $23 per kg and $20 per kg respectively.

TP operates a JIT purchasing system for ingredients and a JIT production system; therefore, there was no inventory during the period.

Prepare a statement which reconciles the flexed budget material cost and the actual material cost. Your statement should include the material price planning variances, and the operational variances including material price, material mix and material yield.

What was the material price planning variance for ingredient A?

Options:

A.

The Material price planning variance – Ingredient A was $73 000 F

B.

The Material price planning variance – Ingredient A was $72 000 F

C.

The Material price planning variance – Ingredient A was $71 000 F

D.

The Material price planning variance – Ingredient A was $75 000 F

Question 39

Where sales volume is the principal budget factor, which of the following is the correct order in which budgets have to be prepared?

Options:

A.

Sales budget, production budget, material usage budget, material purchases budget

B.

Sales budget, production budget, materials purchases budget, material usage budget

C.

Production budget, sales budget, material usage budget, material purchases budget

D.

Prodcution budget, material usage budget, material purchases budget, sales budget

Page: 9 / 9
Exam Code: P1
Exam Name: Management Accounting
Last Update: May 18, 2024
Questions: 260
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