Glenn, Inc Following Are the Actual Costs of Producing 75,000 T-Shirts: 5,000

question 152

Multiple Choice

Glenn, Inc. has done a cost analysis for its production of T-shirts. The following activities and cost drivers have been developed:
$$\begin{array} { l l } \text { Activity } & \text { Cost Farmula } \\\hline \text { Maintenance } & \$ 11,000 + \$ 2 \text { per machine how } \\\text { Machining } & \$ 55,000 + \$ 3 \text { per machine how } \\\text { Inspection } & \$ 70,000 + \$ 500 \text { per batch } \\\text { Setups } & \$ 2,000 \text { per batch } \\\text { Purchasing } & \$ 80,000 + \$ 150 \text { per purchase order }\end{array}$$ Following are the actual costs of producing 75,000 T-shirts: 5,000 machine hours; 10 batches; 20 purchase orders
$\begin{array}{lr}\text { Maintenance } & \$ 20,000 \\\text { Machining } & 73,000 \\\text { Inspection } & 73,000 \\\text { Setups } & 18,000 \\\text { Purchasing } & 82,000\end{array}$

-Refer to the figure.What is the budget variance for inspection in an activity-based performance report?

• A)$1,000 F
• B)$2,000 F
• C)$3,000 F
• D)$4,200 F

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Definitions:

Critical Value

A threshold in hypothesis testing that defines the boundary or cutoff point at which an observed test statistic is considered statistically significant.

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Critical Value

In hypothesis testing, the critical value is a point on the test distribution that is compared to the test statistic to decide whether to reject the null hypothesis.