Question 1

Fixed overhead costs are

Accepted Answer

A)  best controlled on a unit-by-unit basis of products produced. 
B)  mostly incurred to provide the capacity to produce and are best controlled on a total basis at the time they are originally negotiated. 
C)  constant on a per-unit basis at all different activity levels within the relevant range. 
D)  best controlled as to spending during the production process. 
A)  best controlled on a unit-by-unit basis of products produced. 
B)  mostly incurred to provide the capacity to produce and are best controlled on a total basis at the time they are originally negotiated. 
C)  constant on a per-unit basis at all different activity levels within the relevant range. 
D)  best controlled as to spending during the production process.

Question 2

Strong Manufacturing The following information is available for Strong Manufacturing Company for the month of June when the company produced 2,100 units:
  Refer to Strong Manufacturing Company. What is the material price variance?

Accepted Answer

A)  $637.50 U 
B)  $637.50 F 
C)  $630.00 U 
D)  $630.00 F 
A)  $637.50 U 
B)  $637.50 F 
C)  $630.00 U 
D)  $630.00 F

Question 3

The price variance reflects the difference between the price paid for inputs and the standard price for those inputs.

Accepted Answer

A) True 
 B)False

Question 4

Hazelton Company Hazelton Company has the following information available for December when 3,500 units were produced (round answers to the nearest dollar).
  Refer to Hazelton Company. What is the material quantity variance?

Accepted Answer

A)  $2,250 F 
B)  $2,250 U 
C)  $225 F 
D)  $2,475 U 
A)  $2,250 F 
B)  $2,250 U 
C)  $225 F 
D)  $2,475 U

Question 5

The term "standard hours allowed" measures

Accepted Answer

A)  budgeted output at actual hours. 
B)  budgeted output at standard hours. 
C)  actual output at standard hours. 
D)  actual output at actual hours. 
A)  budgeted output at actual hours. 
B)  budgeted output at standard hours. 
C)  actual output at standard hours. 
D)  actual output at actual hours.

Question 6

List and discuss briefly the three standards of attainability.

Accepted Answer

Expected standards reflect what is actua

Question 7

The point of purchase model calculates the materials price variance using the quantity of materials purchased.

Accepted Answer

A) True 
 B)False

Question 8

The sum of the material price variance (calculated at point of purchase) and material quantity variance equals

Accepted Answer

A)  the total cost variance. 
B)  the material mix variance. 
C)  the material yield variance. 
D)  no meaningful number. 
A)  the total cost variance. 
B)  the material mix variance. 
C)  the material yield variance. 
D)  no meaningful number.

Question 9

A company would most likely have an unfavorable labor rate variance and a favorable labor efficiency variance if

Accepted Answer

A)  the mix of workers used in the production process was more experienced than the normal mix. 
B)  the mix of workers used in the production process was less experienced than the normal mix. 
C)  workers from another part of the plant were used due to an extra heavy production schedule. 
D)  the purchasing agent acquired very high quality material that resulted in less spoilage. 
A)  the mix of workers used in the production process was more experienced than the normal mix. 
B)  the mix of workers used in the production process was less experienced than the normal mix. 
C)  workers from another part of the plant were used due to an extra heavy production schedule. 
D)  the purchasing agent acquired very high quality material that resulted in less spoilage.

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

Wimberly Company Wimberly Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar).
  Refer to Wimberly Company. What is the labor efficiency variance?

Accepted Answer

A)  $ 2,955 F 
B)  $ 2,955 U 
C)  $ 3,000 U 
D)  $ 3,000 F 
A)  $ 2,955 F 
B)  $ 2,955 U 
C)  $ 3,000 U 
D)  $ 3,000 F

Question 12

Distinguish between the four-variance, three-variance, two-variance, and one-variance approaches for computing factory overhead variances.

Accepted Answer

The four variance approach is the most c

Question 13

The point of purchase model calculates the materials price variance using the quantity of materials used in production.

Accepted Answer

A) True 
 B)False

Question 14

A company wishing to isolate variances at the point closest to the point of responsibility will determine its material price variance when

Accepted Answer

A)  material is purchased. 
B)  material is issued to production. 
C)  material is used in production. 
D)  production is completed. 
A)  material is purchased. 
B)  material is issued to production. 
C)  material is used in production. 
D)  production is completed.

Question 15

When multiple labor categories are used, the monetary impact of using a higher or lower number of hours than a standard allows is referred to as a labor yield variance.

Accepted Answer

A) True 
 B)False

Question 16

Truman Company
Truman Company applies overhead based on direct labor hours and has the following available for the current month:
   Refer to Truman Company. Compute all the appropriate variances using the two-variance approach.

Accepted Answer

The answer of Truman Company
Truman Company applies overhead based on...

Question 17

The total variance does not provide useful information about the source of cost differences.

Accepted Answer

A) True 
 B)False

Question 18

A favorable fixed overhead spending variance indicates that

Accepted Answer

A)  budgeted fixed overhead is less than actual fixed overhead. 
B)  budgeted fixed overhead is greater than applied fixed overhead. 
C)  applied fixed overhead is greater than budgeted fixed overhead. 
D)  actual fixed overhead is less than budgeted fixed overhead. 
A)  budgeted fixed overhead is less than actual fixed overhead. 
B)  budgeted fixed overhead is greater than applied fixed overhead. 
C)  applied fixed overhead is greater than budgeted fixed overhead. 
D)  actual fixed overhead is less than budgeted fixed overhead.

Question 19

Crichton Company The following information is for Crichton Company's July production:
  (Round all answers to the nearest dollar.)
Refer to Crichton Company. What is the material quantity variance?

Accepted Answer

A)  $3,105 F 
B)  $1,050 F 
C)  $3,105 U 
D)  $1,890 U 
A)  $3,105 F 
B)  $1,050 F 
C)  $3,105 U 
D)  $1,890 U

Question 20

Genesis Company Genesis Company uses a standard cost system for its production process and applies overhead based on direct labor hours. The following information is available for September when Genesis produced 5,000 units:
  Refer to Genesis Company. Using the two-variance approach, what is the controllable variance?

Accepted Answer

A)  $4,075 U 
B)  $4,075 F 
C)  $4,575 U 
D)  $4,575 F 
A)  $4,075 U 
B)  $4,075 F 
C)  $4,575 U 
D)  $4,575 F

Fixed overhead costs are

Strong Manufacturing The following information is available for Strong Manufacturing Company for the month of June when the company produced 2,100 units: Refer to Strong Manufacturing Company. What is the material price variance?

The price variance reflects the difference between the price paid for inputs and the standard price for those inputs.

Hazelton Company Hazelton Company has the following information available for December when 3,500 units were produced (round answers to the nearest dollar). Refer to Hazelton Company. What is the material quantity variance?

The term "standard hours allowed" measures

List and discuss briefly the three standards of attainability.

The point of purchase model calculates the materials price variance using the quantity of materials purchased.

The sum of the material price variance (calculated at point of purchase) and material quantity variance equals

A company would most likely have an unfavorable labor rate variance and a favorable labor efficiency variance if

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

Wimberly Company Wimberly Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar). Refer to Wimberly Company. What is the labor efficiency variance?

Distinguish between the four-variance, three-variance, two-variance, and one-variance approaches for computing factory overhead variances.

The point of purchase model calculates the materials price variance using the quantity of materials used in production.

A company wishing to isolate variances at the point closest to the point of responsibility will determine its material price variance when

When multiple labor categories are used, the monetary impact of using a higher or lower number of hours than a standard allows is referred to as a labor yield variance.

Truman Company Truman Company applies overhead based on direct labor hours and has the following available for the current month: Refer to Truman Company. Compute all the appropriate variances using the two-variance approach.

The total variance does not provide useful information about the source of cost differences.

A favorable fixed overhead spending variance indicates that

Crichton Company The following information is for Crichton Company's July production: (Round all answers to the nearest dollar.) Refer to Crichton Company. What is the material quantity variance?

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

Fixed overhead costs are

Strong Manufacturing The following information is available for Strong Manufacturing Company for the month of June when the company produced 2,100 units: Refer to Strong Manufacturing Company. What is the material price variance?

The price variance reflects the difference between the price paid for inputs and the standard price for those inputs.

Hazelton Company Hazelton Company has the following information available for December when 3,500 units were produced (round answers to the nearest dollar). Refer to Hazelton Company. What is the material quantity variance?

The term "standard hours allowed" measures

List and discuss briefly the three standards of attainability.

The point of purchase model calculates the materials price variance using the quantity of materials purchased.

The sum of the material price variance (calculated at point of purchase) and material quantity variance equals

A company would most likely have an unfavorable labor rate variance and a favorable labor efficiency variance if

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

Wimberly Company Wimberly Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar). Refer to Wimberly Company. What is the labor efficiency variance?

Distinguish between the four-variance, three-variance, two-variance, and one-variance approaches for computing factory overhead variances.

The point of purchase model calculates the materials price variance using the quantity of materials used in production.

A company wishing to isolate variances at the point closest to the point of responsibility will determine its material price variance when

When multiple labor categories are used, the monetary impact of using a higher or lower number of hours than a standard allows is referred to as a labor yield variance.

Truman Company Truman Company applies overhead based on direct labor hours and has the following available for the current month: Refer to Truman Company. Compute all the appropriate variances using the two-variance approach.

The total variance does not provide useful information about the source of cost differences.

A favorable fixed overhead spending variance indicates that

Crichton Company The following information is for Crichton Company's July production: (Round all answers to the nearest dollar.) Refer to Crichton Company. What is the material quantity variance?

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