Question 1

The investigation of a materials quantity variance usually begins in the

Accepted Answer

A) production department. 
B) purchasing department. 
C) sales department. 
D) controller's department. 
A) production department. 
B) purchasing department. 
C) sales department. 
D) controller's department.

Question 2

Budget data are not journalized in cost accounting systems with the exception of

Accepted Answer

A) the application of manufacturing overhead. 
B) direct labor budgets. 
C) direct materials budgets. 
D) cash budget data. 
A) the application of manufacturing overhead. 
B) direct labor budgets. 
C) direct materials budgets. 
D) cash budget data.

Question 3

Shipp, Inc. manufactures a product requiring two pounds of direct material. During 2016, Shipp purchases 24,000 pounds of material for $99,200 when the standard price per pound is $4. During 2016, Shipp uses 22,000 pounds to make 12,000 products. The standard direct material cost per unit of finished product is

Accepted Answer

A) $8.27. 
B) $9.01. 
C) $8.00. 
D) $8.53. 
A) $8.27. 
B) $9.01. 
C) $8.00. 
D) $8.53.

Question 4

The difference between a budget and a standard is that

Accepted Answer

A) a budget expresses what costs were, while a standard expresses what costs should be. 
B) a budget expresses management's plans, while a standard reflects what actually happened. 
C) a budget expresses a total amount, while a standard expresses a unit amount. 
D) standards are excluded from the cost accounting system, whereas budgets are generally incorporated into the cost accounting system. 
A) a budget expresses what costs were, while a standard expresses what costs should be. 
B) a budget expresses management's plans, while a standard reflects what actually happened. 
C) a budget expresses a total amount, while a standard expresses a unit amount. 
D) standards are excluded from the cost accounting system, whereas budgets are generally incorporated into the cost accounting system.

Question 5

Denmark Corporation's variance report for the purchasing department reports 1,000 units of material A purchased and 2,400 units of material B purchased. It also reports standard prices of $2 for Material A and $3 for Material B. Actual prices reported are $2.10 for Material A and $2.80 for Material B. Denmark should report a total price variance of

Accepted Answer

A) $380 F. 
B) $340 F. 
C) $340 U. 
D) $380 U. 
A) $380 F. 
B) $340 F. 
C) $340 U. 
D) $380 U.

Question 6

The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

Accepted Answer

A) Favorable materials quantity variance 
B) Favorable total materials variance 
C) Unfavorable materials price variance 
D) Unfavorable labor quantity variance 
A) Favorable materials quantity variance 
B) Favorable total materials variance 
C) Unfavorable materials price variance 
D) Unfavorable labor quantity variance

Question 7

The total materials variance is equal to the

Accepted Answer

A) materials price variance. 
B) difference between the materials price variance and materials quantity variance. 
C) product of the materials price variance and the materials quantity variance. 
D) sum of the materials price variance and the materials quantity variance. 
A) materials price variance. 
B) difference between the materials price variance and materials quantity variance. 
C) product of the materials price variance and the materials quantity variance. 
D) sum of the materials price variance and the materials quantity variance.

Question 8

The investigation of materials price variance usually begins in the

Accepted Answer

A) first production department. 
B) purchasing department. 
C) controller's office. 
D) accounts payable department. 
A) first production department. 
B) purchasing department. 
C) controller's office. 
D) accounts payable department.

Question 9

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Accepted Answer

A) True 
 B)False

Question 10

The formula for the materials price variance is

Accepted Answer

A) (AQ × SP) - (SQ × SP). 
B) (AQ × AP) - (AQ × SP). 
C) (AQ × AP) - (SQ × SP). 
D) (AQ × SP) - (SQ × AP). 
A) (AQ × SP) - (SQ × SP). 
B) (AQ × AP) - (AQ × SP). 
C) (AQ × AP) - (SQ × SP). 
D) (AQ × SP) - (SQ × AP).

Question 11

The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

Accepted Answer

A) budgeted overhead costs by an expected standard activity index. 
B) actual overhead costs by an expected standard activity index. 
C) budgeted overhead costs by actual activity. 
D) actual overhead costs by actual activity. 
A) budgeted overhead costs by an expected standard activity index. 
B) actual overhead costs by an expected standard activity index. 
C) budgeted overhead costs by actual activity. 
D) actual overhead costs by actual activity.

Question 12

The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

Accepted Answer

A) total labor variance. 
B) labor price variance. 
C) labor quantity variance. 
D) labor efficiency variance. 
A) total labor variance. 
B) labor price variance. 
C) labor quantity variance. 
D) labor efficiency variance.

Question 13

There could be instances where the production department is responsible for a direct materials price variance.

Accepted Answer

A) True 
 B)False

Question 14

The two levels that standards may be set at are

Accepted Answer

A) normal and fully efficient. 
B) normal and ideal. 
C) ideal and less efficient. 
D) fully efficient and fully effective. 
A) normal and fully efficient. 
B) normal and ideal. 
C) ideal and less efficient. 
D) fully efficient and fully effective.

Question 15

Unfavorable materials price and quantity variances are generally the responsibility of the $\quad$$\quad$$\quad$$\quad$Price$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$Quantity
a. Purchasing department$\quad$$\quad$ Purchasing Department
b. Purchasing department $\quad$$\quad$Production Department
c. Production department $\quad$$\quad$Production Department
d. Production Department $\quad$$\quad$Purchasing Department

Accepted Answer

The answer of Unfavorable materials price and quantity variances are...

Question 16

A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Accepted Answer

A) $2 
B) $4 
C) $6 
D) Cannot be determined from the data provided. 
A) $2 
B) $4 
C) $6 
D) Cannot be determined from the data provided.

Question 17

Using standard costs

Accepted Answer

A) can make management planning more difficult. 
B) promotes greater economy. 
C) does not help in setting prices. 
D) weakens management control. 
A) can make management planning more difficult. 
B) promotes greater economy. 
C) does not help in setting prices. 
D) weakens management control.

Question 18

If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

Accepted Answer

A) $3,600 F 
B) $2,700 U 
C) $900 F 
D) $4,050 U 
A) $3,600 F 
B) $2,700 U 
C) $900 F 
D) $4,050 U

Question 19

The direct materials quantity standard would not be expressed in

Accepted Answer

A) pounds. 
B) barrels. 
C) dollars. 
D) board feet. 
A) pounds. 
B) barrels. 
C) dollars. 
D) board feet.

Question 20

Which of the following is true?

Accepted Answer

A) The form, content, and frequency of variance reports vary considerably among companies. 
B) The form, content, and frequency of variance reports do not vary among companies. 
C) The form and content of variance reports vary considerably among companies, but the frequency is always weekly. 
D) The form and content of variance reports are consistent among companies, but the frequency varies. 
A) The form, content, and frequency of variance reports vary considerably among companies. 
B) The form, content, and frequency of variance reports do not vary among companies. 
C) The form and content of variance reports vary considerably among companies, but the frequency is always weekly. 
D) The form and content of variance reports are consistent among companies, but the frequency varies.

The investigation of a materials quantity variance usually begins in the

Budget data are not journalized in cost accounting systems with the exception of

The difference between a budget and a standard is that

The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

The total materials variance is equal to the

The investigation of materials price variance usually begins in the

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

The formula for the materials price variance is

The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

There could be instances where the production department is responsible for a direct materials price variance.

The two levels that standards may be set at are

A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Using standard costs

If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

The direct materials quantity standard would not be expressed in

Which of the following is true?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Planning for Capital Investments

Filters

Exam 22: Standard Costs and Balanced Scorecard

The investigation of a materials quantity variance usually begins in the

Budget data are not journalized in cost accounting systems with the exception of

The difference between a budget and a standard is that

The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

The total materials variance is equal to the

The investigation of materials price variance usually begins in the

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

The formula for the materials price variance is

The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

There could be instances where the production department is responsible for a direct materials price variance.

The two levels that standards may be set at are

A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Using standard costs

If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

The direct materials quantity standard would not be expressed in

Which of the following is true?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Planning for Capital Investments

Filters