Exam 22: Evaluating Variances From Standard Costs

Using the following information, prepare a factory overhead cost budget for Jacob Company where the total factory overhead cost is $206,500 at normal capacity (100%). Include capacity at 60%, 80%, 100%, and 120%. Total variable cost is $15.25 per unit, and total fixed costs are $54,000. The information is for the month ended October 31. (Hint: Determine units produced at normal capacity.)

Use this information for Stringer Company to answer the questions that follow. ​The following data are given for Stringer Company: ​ Overhead is applied on standard labor hours. -The direct materials quantity variance is

A favorable cost variance occurs when

Standard costs are used in companies for a variety of reasons. Which of the following is not one of the benefits of using standard costs?

-Calculate the direct materials quantity variance.

The formula to compute the direct labor rate variance is to calculate the difference between

Assuming that the standard fixed overhead rate is based on full capacity, the cost of available but unused productive capacity is indicated by the

The standard costs and actual costs for direct labor for the manufacture of 2,500 actual units of product are as follows:Standard CostsDirect labor7,500 hours @ $11.80Actual CostsDirect labor7,400 hours @ $11.40The direct labor rate variance is

A budget performance report compares actual results with the budgeted amounts and reports differences for possible investigation.

-The direct labor rate variance is

Which of the following conditions normally would not indicate that standard costs should be revised?

Sally's Chocolate Company makes gourmet cupcakes that are sold by the dozen. Compute the standard cost for one dozen cupcakes, based on the following standards:​

A company should only use nonfinancial performance measures when financial measures cannot be calculated.

Rosser Company produces a container that requires 4 yards of material per unit. The standard price of one yard of material is $4.50. During the month, 9,500 chairs were manufactured using 37,300 yards of material.​Journalize the entry to record the standard direct materials used in production.

Compute the standard cost for one pair of boots, based on the following standards for each pair of boots:​

The following data are given for Bahia Company:​ Overhead is applied on standard labor hours.The variable factory overhead controllable variance is

Match each of the following formulas or descriptions with the term (a-e) it defines. -(Actual Rate per Hour - Standard Rate per Hour) × Actual Hours

Use this information for Stringer Company to answer the questions that follow. ​The following data are given for Stringer Company: ​ Overhead is applied on standard labor hours. -The direct materials price variance is

In most businesses, cost standards are established principally by accountants.

Match each of the following formulas or descriptions with the term (a-e) it defines. -Standard variable overhead for actual units produced