Question 1

The formula AQ × (SP - AP) is the:

Accepted Answer

A)  direct materials spending variance. 
B)  direct materials volume variance. 
C)  direct materials price variance. 
D)  direct materials quantity variance. 
A)  direct materials spending variance. 
B)  direct materials volume variance. 
C)  direct materials price variance. 
D)  direct materials quantity variance.

Question 2

Which of the following statements is true about variances?

Accepted Answer

A)  Positive variances (i.e., those with a positive sign) are always favorable. 
B)  Positive variances (i.e., those with a positive sign) are always unfavorable. 
C)  Negative variances (i.e., those with a negative sign) are always favorable. 
D)  There is not necessarily any correlation between the sign of the result (positive or negative) and whether the variance is positive or negative. 
A)  Positive variances (i.e., those with a positive sign) are always favorable. 
B)  Positive variances (i.e., those with a positive sign) are always unfavorable. 
C)  Negative variances (i.e., those with a negative sign) are always favorable. 
D)  There is not necessarily any correlation between the sign of the result (positive or negative) and whether the variance is positive or negative.

Question 3

Basil Tooling uses a standard cost system to account for the costs of its one product. Standards are 4 sheets of ½ inch steel at $110 per sheet and 14 hours of labor at a standard wage rate of $13. During July, Basil Tooling produced 600 units. Materials purchased and used totaled 2,540 sheets at a total cost of $268,850. Payroll totaled $112,930 for 8,770 hours worked. Calculate the:
a. direct materials price variance.
b. direct materials quantity variance.
c. direct labor rate variance.
d. direct labor efficiency variance.

Accepted Answer

a. $10,550 favorable = $268,850 - (2,540

Question 4

The standard costs are summarized on a:

Accepted Answer

A)  static cost card. 
B)  flexible budget card. 
C)  standard cost card. 
D)  standard static carD.
The standard cost card summarizes standard costs by showing what the company should spend to make a single unit of product based on expected production and sales for the coming perioD. 
A)  static cost card. 
B)  flexible budget card. 
C)  standard cost card. 
D)  standard static carD.
The standard cost card summarizes standard costs by showing what the company should spend to make a single unit of product based on expected production and sales for the coming perioD.

Question 5

Regent Corp. uses a standard cost system to account for the costs of its one product. Materials standards are 3 pounds of material at $14 per pound, and labor standards are 4 hours of labor at a standard wage rate of $11. During July Regent Corp. produced 3,300 units. Materials purchased and used totaled 10,100 pounds at a total cost of $142,650. Payroll totaled $146,780 for 13,150 hours worked. Calculate the:
a. direct materials price variance.
b. direct materials quantity variance.

Accepted Answer

a. $1,250 unfavorable = $142,6

Question 6

When preparing a flexible budget, fixed costs should remain the same as on the master budget

Accepted Answer

A) True 
 B)False

Question 7

The formula SP × (SQ - AQ) is the:

Accepted Answer

A)  direct materials spending variance. 
B)  direct materials volume variance. 
C)  direct materials price variance. 
D)  direct materials quantity variance. 
A)  direct materials spending variance. 
B)  direct materials volume variance. 
C)  direct materials price variance. 
D)  direct materials quantity variance.

The formula AQ × (SP - AP) is the:

Which of the following statements is true about variances?

The standard costs are summarized on a:

When preparing a flexible budget, fixed costs should remain the same as on the master budget

The formula SP × (SQ - AQ) is the:

Introduction to Managerial Accounting

Job-Order Costing

Process Costing

Activity-Based Cost Management

Cost Behavior and Estimation

Cost-Volume-Profit Analysis

Incremental Analysis for Short-Term Decision Making

Budgeting and Planning

Decentralized Performance Evaluation

Capital Budgeting

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 9: Standard Costing and Variances

The formula AQ × (SP - AP) is the:

Which of the following statements is true about variances?

The standard costs are summarized on a:

When preparing a flexible budget, fixed costs should remain the same as on the master budget

The formula SP × (SQ - AQ) is the:

Introduction to Managerial Accounting

Job-Order Costing

Process Costing

Activity-Based Cost Management

Cost Behavior and Estimation

Cost-Volume-Profit Analysis

Incremental Analysis for Short-Term Decision Making

Budgeting and Planning

Decentralized Performance Evaluation

Capital Budgeting

Statement of Cash Flows

Financial Statement Analysis

Filters