Exam 23: Evaluating Variances From Standard Costs

​ *Actual hours are equal to standard hours for units produced.​ -The variable factory overhead controllable variance is

The principle of exceptions allows managers to focus on correcting variances between standard costs and actual costs.

Standards are performance goals used to evaluate and control operations.

​ *Actual hours are equal to standard hours for units produced.​ -Planned sales are 10,000 units at $7.00 per unit. Actual sales are 11,000 units at $6.50 per unit. Which of the following statements is not true?

Standard and actual costs for direct labor for the manufacture of 300 units of product were as follows: Actual costs 125 hours at $54 Standard costs 131 hours at $53 Determine the direct labor (a) time variance, (b) rate variance, and (c) total cost variance.

At the end of the fiscal year, the variances from standard are usually transferred to the finished goods account.

Accounting systems that use standards for product costs are called standard cost systems.

The standard costs and actual costs for direct labor in the manufacture of 2,500 units of product are as follows: The direct labor time variance is

If the price paid per unit differs from the standard price per unit for direct materials, the variance is a _____ variance.

The following data are given for Harry Company: Overhead is applied on standard labor hours. (Round interim calculations to the nearest cent.) -The direct labor time variance is

​ *Actual hours are equal to standard hours for units produced.​ -The total factory overhead cost variance is

The standard costs and actual costs for direct materials for the manufacture of 2,500 actual units of product are as follows: The direct materials quantity variance is

If the wage rate paid per hour differs from the standard wage rate per hour for direct labor, the variance is a _____ variance.

The following data relate to direct labor costs for the current period: Standard costs 9,000 hours at $5.50 Actual costs 8,500 hours at $5.75 The direct labor rate variance is

The following data are given for Harry Company: Overhead is applied on standard labor hours. (Round interim calculations to the nearest cent.) -The direct labor rate variance is

The standard factory overhead rate is $7.50 per machine hour ($6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: ​ -Favorable volume variances may be harmful when

The volume variance measures the use of fixed factory overhead resources.

Using the following information, prepare a factory overhead cost budget for Andover Company where the total factory overhead cost is $75,500 at normal capacity (100%). Include capacity at 75%, 90%, 100%, and 110%. Total variable cost is $6.25 per unit and total fixed costs are $38,000. The information is for the month ending August 31. (Hint: Determine units produced at normal capacity.)

Match each of the following formulas and phrases with the term (a-e) it describes. -(Actual Price - Standard Price) × Actual Quantity

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