Question 1

Standards that reflect what is expected to occur are referred to as ______________________________.

Accepted Answer

The answer of Standards that reflect what is expected to...

Question 2

The total variance can provide useful information about the source of cost differences.

Accepted Answer

A) True 
 B)False

Question 3

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July:
  Refer to Ritchie Company Using the three-variance approach,what is the spending variance?

Accepted Answer

A) $23,850 U 
B) $23,850 F 
C) $14,280 F 
D) $14,280 U 
A) $23,850 U 
B) $23,850 F 
C) $14,280 F 
D) $14,280 U

Question 4

Standards that provide for no human limitations or operating delays are referred to as ______________________________.

Accepted Answer

The answer of Standards that provide for no human limitations...

Question 5

A standard cost card is prepared after manufacturing standards have been developed for direct materials,direct labor,and factory overhead.

Accepted Answer

A) True 
 B)False

Question 6

Specifications for materials are compiled on a purchase requisition.

Accepted Answer

A) True 
 B)False

Question 7

The difference between total actual cost incurred and total standard cost applied is referred to as _________________________.

Accepted Answer

The answer of The difference between total actual cost incurred...

Question 8

Unfavorable variances are represented by debit balances in the overhead account.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following capacity levels has traditionally been used to compute the fixed overhead application rate?

Accepted Answer

A) expected annual 
B) normal 
C) theoretical 
D) prior year 
A) expected annual 
B) normal 
C) theoretical 
D) prior year

Question 10

In analyzing manufacturing overhead variances,the volume variance is the difference between the

Accepted Answer

A) amount shown in the flexible budget and the amount shown in the debit side of the overhead control account. 
B) predetermined overhead application rate and the flexible budget application rate times actual hours worked. 
C) budget allowance based on standard hours allowed for actual production for the period and the amount budgeted to be applied during the period. 
D) actual amount spent for overhead items during the period and the overhead amount applied to production during the period. 
A) amount shown in the flexible budget and the amount shown in the debit side of the overhead control account. 
B) predetermined overhead application rate and the flexible budget application rate times actual hours worked. 
C) budget allowance based on standard hours allowed for actual production for the period and the amount budgeted to be applied during the period. 
D) actual amount spent for overhead items during the period and the overhead amount applied to production during the period.

Question 11

The difference between budgeted variable overhead for actual hours and standard overhead is the variable overhead efficiency variance.

Accepted Answer

A) True 
 B)False

Question 12

Expected standards are a valuable tool for motivation and control.

Accepted Answer

A) True 
 B)False

Question 13

The difference between the actual wages paid to employees and the standard wages for all hours worked is the labor rate variance.

Accepted Answer

A) True 
 B)False

Question 14

A favorable fixed overhead volume variance occurs if

Accepted Answer

A) there is a favorable labor efficiency variance. 
B) there is a favorable labor rate variance. 
C) production is less than planned. 
D) production is greater than planned. 
A) there is a favorable labor efficiency variance. 
B) there is a favorable labor rate variance. 
C) production is less than planned. 
D) production is greater than planned.

Question 15

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July:
  Refer to Ritchie Company Using the three-variance approach,what is the volume variance?

Accepted Answer

A) $13,260 U 
B) $2,640 F 
C) $6,930 U 
D) $0 
A) $13,260 U 
B) $2,640 F 
C) $6,930 U 
D) $0

Question 16

Strong Manufacturing The following information is available for Strong Manufacturing Company for the month of June when the company produced 2,100 units:
$\begin{array}{ll}\text { Standard: }\
\text { Material } & 2 \text { pounds per urit } @ \$ 5.80 \text { per pound } \
\text { Labor } & 3 \text { direct labor hours per urit @ } \$ 10.00 \text { per hour }\\\text { Actual: }\
\text { Material } & 4,250 \text { pounds purchased and used @ } \$ 5.65 \text { per pound } \
\text { Labor } & 6,300 \text { directlabor hours at } \$ 9.75 \text { per hour }
\end{array}$ Refer to Strong Manufacturing Company.What is the labor efficiency variance?

Accepted Answer

A) $731.25 F 
B) $731.25 U 
C) $750.00 F 
D) none of the answers are correct 
A) $731.25 F 
B) $731.25 U 
C) $750.00 F 
D) none of the answers are correct

Question 17

Reichs Company The following information is for Reichs Company's September production:
$\begin{array}{ll}
\textbf { Standard: }\
\text { Material } & 4.0 \text { feet per unit } @ \$ 3.75 \text { per foot } \
\text { Labor } & 3.0 \text { hours per unit } @ \$ 8.25 \text { per hour }
\end{array}$

$\begin{array}{ll}
\textbf { Actual: }\
\text { Production } & 3,500 \text { units produced during the month } \
\text { Material } & 14,200 \text { feet used; } 14,700 \text { feet purchased @ } \$ 3.70\text { per foot } \
\text { Labor } & 10,400 \text { direct labor hours } \$ 8.35\text { per hour }
\end{array}$ (Round all answers to the nearest dollar.)
Refer to Reichs Company.What is the labor efficiency variance?

Accepted Answer

A) $825 F 
B) $825 U 
C) $835 F 
D) $835 U 
A) $825 F 
B) $825 U 
C) $835 F 
D) $835 U

Question 18

A primary purpose of using a standard cost system is

Accepted Answer

A) to make things easier for managers in the production facility. 
B) to provide a distinct measure of cost control. 
C) to minimize the cost per unit of production. 
D) b and c are correct. 
A) to make things easier for managers in the production facility. 
B) to provide a distinct measure of cost control. 
C) to minimize the cost per unit of production. 
D) b and c are correct.

Question 19

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July:
  Refer to Ritchie Company Using the four-variance approach,what is the variable overhead efficiency variance?

Accepted Answer

A) $9,570 F 
B) $9,570 U 
C) $2,200 F 
D) $2,200 U 
A) $9,570 F 
B) $9,570 U 
C) $2,200 F 
D) $2,200 U

Question 20

The overhead variance calculated as total budgeted overhead at the actual input production level minus total budgeted overhead at the standard hours allowed for actual output is the

Accepted Answer

A) efficiency variance. 
B) spending variance. 
C) volume variance. 
D) budget variance. 
A) efficiency variance. 
B) spending variance. 
C) volume variance. 
D) budget variance.

Standards that reflect what is expected to occur are referred to as ______________________________.

The total variance can provide useful information about the source of cost differences.

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July: Refer to Ritchie Company Using the three-variance approach,what is the spending variance?

Standards that provide for no human limitations or operating delays are referred to as ______________________________.

A standard cost card is prepared after manufacturing standards have been developed for direct materials,direct labor,and factory overhead.

Specifications for materials are compiled on a purchase requisition.

The difference between total actual cost incurred and total standard cost applied is referred to as _________________________.

Unfavorable variances are represented by debit balances in the overhead account.

Which of the following capacity levels has traditionally been used to compute the fixed overhead application rate?

In analyzing manufacturing overhead variances,the volume variance is the difference between the

The difference between budgeted variable overhead for actual hours and standard overhead is the variable overhead efficiency variance.

Expected standards are a valuable tool for motivation and control.

The difference between the actual wages paid to employees and the standard wages for all hours worked is the labor rate variance.

A favorable fixed overhead volume variance occurs if

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July: Refer to Ritchie Company Using the three-variance approach,what is the volume variance?

A primary purpose of using a standard cost system is

The overhead variance calculated as total budgeted overhead at the actual input production level minus total budgeted overhead at the standard hours allowed for actual output is the

Introduction to Cost Accounting

Cost Terminology and Cost Behaviors

Predetermined Overhead Rates, flexible Budgets, and Absorptionvariable Costing

Activity-Based Management and Activity-Based Costing

Job Order Costing

Process Costing

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting, support Department Allocations, and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters

Exam 7: Standard Costing and Variance Analysis

Standards that reflect what is expected to occur are referred to as ______________________________.

The total variance can provide useful information about the source of cost differences.

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July: Refer to Ritchie Company Using the three-variance approach,what is the spending variance?

Standards that provide for no human limitations or operating delays are referred to as ______________________________.

A standard cost card is prepared after manufacturing standards have been developed for direct materials,direct labor,and factory overhead.

Specifications for materials are compiled on a purchase requisition.

The difference between total actual cost incurred and total standard cost applied is referred to as _________________________.

Unfavorable variances are represented by debit balances in the overhead account.

Which of the following capacity levels has traditionally been used to compute the fixed overhead application rate?

In analyzing manufacturing overhead variances,the volume variance is the difference between the

The difference between budgeted variable overhead for actual hours and standard overhead is the variable overhead efficiency variance.

Expected standards are a valuable tool for motivation and control.

The difference between the actual wages paid to employees and the standard wages for all hours worked is the labor rate variance.

A favorable fixed overhead volume variance occurs if

Ritchie Company Ritchie Company uses a standard cost system for its production process.Ritchie Company applies overhead based on direct labor hours.The following information is available for July: Refer to Ritchie Company Using the three-variance approach,what is the volume variance?

A primary purpose of using a standard cost system is

The overhead variance calculated as total budgeted overhead at the actual input production level minus total budgeted overhead at the standard hours allowed for actual output is the

Introduction to Cost Accounting

Cost Terminology and Cost Behaviors

Predetermined Overhead Rates, flexible Budgets, and Absorptionvariable Costing

Activity-Based Management and Activity-Based Costing

Job Order Costing

Process Costing

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting, support Department Allocations, and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters