Question 1

Which of the following is not considered an advantage of using standard costs?

Accepted Answer

A) Standard costs can reduce clerical costs. 
B) Standard costs can be useful in setting prices for finished goods. 
C) Standard costs can be used as a means of finding fault with performance. 
D) Standard costs can make employees "cost-conscious." 
A) Standard costs can reduce clerical costs. 
B) Standard costs can be useful in setting prices for finished goods. 
C) Standard costs can be used as a means of finding fault with performance. 
D) Standard costs can make employees "cost-conscious."

Question 2

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 3

The formula for the labor price variance is

Accepted Answer

A) (AH) x (SR) less (SH) x (SR). 
B) (AH) x (AR) less (AH) x (SR). 
C) (AH) x (AR) less (SH) x (SR). 
D) (AH) x (SR) less (AH) x (SR). 
A) (AH) x (SR) less (SH) x (SR). 
B) (AH) x (AR) less (AH) x (SR). 
C) (AH) x (AR) less (SH) x (SR). 
D) (AH) x (SR) less (AH) x (SR).

Question 4

The standard number of hours that should have been worked for the output attained is 6000 direct labor hours and the actual number of direct labor hours worked was 6300.If the direct labor price variance was $3150 unfavorable and the standard rate of pay was $9 per direct labor hour what was the actual rate of pay for direct labor?

Accepted Answer

A) $8.50 per direct labor hour 
B) $7.50 per direct labor hour 
C) $9.50 per direct labor hour 
D) $9.00 per direct labor hour 
A) $8.50 per direct labor hour 
B) $7.50 per direct labor hour 
C) $9.50 per direct labor hour 
D) $9.00 per direct labor hour

Question 5

A company uses 20000 pounds of materials for which it paid $6.00 a pound.The materials price variance was $15000 unfavorable.What is the standard price per pound?

Accepted Answer

A) $0.75 
B) $5.25 
C) $6.00 
D) $6.75 
A) $0.75 
B) $5.25 
C) $6.00 
D) $6.75

Question 6

Ideal standards will generally result in favorable variances for the company.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following statements about standard costs is false?

Accepted Answer

A) Properly set standards should promote efficiency. 
B) Standard costs facilitate management planning. 
C) Standards should not be used in "management by exception." 
D) Standard costs can simplify the costing of inventories. 
A) Properly set standards should promote efficiency. 
B) Standard costs facilitate management planning. 
C) Standards should not be used in "management by exception." 
D) Standard costs can simplify the costing of inventories.

Question 8

Which one of the following describes the total overhead variance?

Accepted Answer

A) The difference between what was actually incurred and the flexible budget amount 
B) The difference between what was actually incurred and overhead applied 
C) The difference between the overhead applied and the flexible budget amount 
D) The difference between what was actually incurred and the total production budget 
A) The difference between what was actually incurred and the flexible budget amount 
B) The difference between what was actually incurred and overhead applied 
C) The difference between the overhead applied and the flexible budget amount 
D) The difference between what was actually incurred and the total production budget

Question 9

Unfavorable materials price and quantity variances are generally the responsibility of the $\begin{array}{llcc}
 \quad\quad\quad\quad\underline{ \text { Price }} &\quad\quad\quad\quad\quad\quad \underline{ \text { Quantity}}
\end{array}$

a.$\begin{array}{llcc}
 \text { Purchasing department  } &\text { Purchasing Department}
\end{array}$

b.$\begin{array}{llcc}
 \text { Purchasing department  } &\text {  Production Department }
\end{array}$

c.$\begin{array}{llcc}
\text { Production department  } &\text { Production Department }
\end{array}$

d.$\begin{array}{llcc}
 \text {Production Department  } &
\text { Purchasing Department}
\end{array}$

Accepted Answer

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

Question 10

Standards may be useful in setting selling prices for finished goods.

Accepted Answer

A) True 
 B)False

Question 11

An advantage of standard costs is that they simplify costing of inventories and reduce clerical costs.

Accepted Answer

A) True 
 B)False

Question 12

Dillon has a standard of 2 hours of labor per unit at $12 per hour.In producing 2000 units Dillon used 3850 hours of labor at a total cost of $46970.Dillon's labor quantity variance is

Accepted Answer

A) $770 U. 
B) $770 F. 
C) $1800 F. 
D) $1930 F. 
A) $770 U. 
B) $770 F. 
C) $1800 F. 
D) $1930 F.

Question 13

Dillon has a standard of 1.5 pounds of materials per unit at $6 per pound.In producing 2000 units Dillon used 3100 pounds of materials at a total cost of $18135.Dillon's materials quantity variance is

Accepted Answer

A) $135 F. 
B) $465 U. 
C) $600 U. 
D) $1050 U. 
A) $135 F. 
B) $465 U. 
C) $600 U. 
D) $1050 U.

Question 14

The materials price variance is normally caused by the production department.

Accepted Answer

A) True 
 B)False

Question 15

A standard which represents an efficient level of performance that is attainable under expected operating conditions is called a(n)

Accepted Answer

A) ideal standard. 
B) loose standard. 
C) tight standard. 
D) normal standard. 
A) ideal standard. 
B) loose standard. 
C) tight standard. 
D) normal standard.

Which of the following is not considered an advantage of using standard costs?

The total materials variance is equal to the

The formula for the labor price variance is

A company uses 20000 pounds of materials for which it paid $6.00 a pound.The materials price variance was $15000 unfavorable.What is the standard price per pound?

Ideal standards will generally result in favorable variances for the company.

Which of the following statements about standard costs is false?

Which one of the following describes the total overhead variance?

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

Standards may be useful in setting selling prices for finished goods.

An advantage of standard costs is that they simplify costing of inventories and reduce clerical costs.

Dillon has a standard of 2 hours of labor per unit at $12 per hour.In producing 2000 units Dillon used 3850 hours of labor at a total cost of $46970.Dillon's labor quantity variance is

Dillon has a standard of 1.5 pounds of materials per unit at $6 per pound.In producing 2000 units Dillon used 3100 pounds of materials at a total cost of $18135.Dillon's materials quantity variance is

The materials price variance is normally caused by the production department.

A standard which represents an efficient level of performance that is attainable under expected operating conditions is called a(n)

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Cost-Volume Profit Analysis: Additional Issues

Filters

Exam 16: Activity Based Costing

Which of the following is not considered an advantage of using standard costs?

The total materials variance is equal to the

The formula for the labor price variance is

A company uses 20000 pounds of materials for which it paid $6.00 a pound.The materials price variance was $15000 unfavorable.What is the standard price per pound?

Ideal standards will generally result in favorable variances for the company.

Which of the following statements about standard costs is false?

Which one of the following describes the total overhead variance?

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

Standards may be useful in setting selling prices for finished goods.

An advantage of standard costs is that they simplify costing of inventories and reduce clerical costs.

Dillon has a standard of 2 hours of labor per unit at $12 per hour.In producing 2000 units Dillon used 3850 hours of labor at a total cost of $46970.Dillon's labor quantity variance is

Dillon has a standard of 1.5 pounds of materials per unit at $6 per pound.In producing 2000 units Dillon used 3100 pounds of materials at a total cost of $18135.Dillon's materials quantity variance is

The materials price variance is normally caused by the production department.

A standard which represents an efficient level of performance that is attainable under expected operating conditions is called a(n)

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Cost-Volume Profit Analysis: Additional Issues

Filters