Question 1

Match between columns
                        Premises: theoretical standard
actual cost
actual cost > standard cost at actual volumes
an example is the number of customer complaints
normal standard

Accepted Answer

The Answer of Ideal standard and Currently attainable standard and is...

Question 2

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

Accepted Answer

A)  $73,250 favorable 
B)  $73,250 unfavorable 
C)  $59,400 favorable 
D)  $59,400 unfavorable 
A)  $73,250 favorable 
B)  $73,250 unfavorable 
C)  $59,400 favorable 
D)  $59,400 unfavorable B

Question 3

Standards that represent levels of operation that can be attained with reasonable effort are called

Accepted Answer

A)  theoretical standards 
B)  ideal standards 
C)  variable standards 
D)  normal standards 
A)  theoretical standards 
B)  ideal standards 
C)  variable standards 
D)  normal standards D

Question 4

The standard price and quantity of direct materials are separated because

Accepted Answer

A)  GAAP and IFRS reporting requires separation 
B)  direct materials prices are controlled by the purchasing department and quantity used is controlled by the production department 
C)  standard prices are more difficult to estimate than standard quantities 
D)  standard quantities change more frequently than standard prices 
A)  GAAP and IFRS reporting requires separation 
B)  direct materials prices are controlled by the purchasing department and quantity used is controlled by the production department 
C)  standard prices are more difficult to estimate than standard quantities 
D)  standard quantities change more frequently than standard prices

Question 5

The following data relate to direct labor costs for March:
Rate: standard, $12.00; actual, $12.25
Hours: standard, 18,500; actual, 17,955
Units of production: 9,450
Calculate the direct labor time variance.

Accepted Answer

A)  $2,362.50 favorable 
B)  $2,362.50 unfavorable 
C)  $6,540.00 favorable 
D)  $6,540.00 unfavorable 
A)  $2,362.50 favorable 
B)  $2,362.50 unfavorable 
C)  $6,540.00 favorable 
D)  $6,540.00 unfavorable

Question 6

The following data relate to direct materials costs for February:
Materials cost per yard: standard, $2.00; actual, $2.10
Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards
Units of production: 9,500
Calculate the direct materials price variance.

Accepted Answer

A)  $1,795.50 favorable 
B)  $378.00 favorable 
C)  $4,512.50 unfavorable 
D)  $378.00 unfavorable 
A)  $1,795.50 favorable 
B)  $378.00 favorable 
C)  $4,512.50 unfavorable 
D)  $378.00 unfavorable

Question 7

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:   What is the amount of the variable factory overhead controllable variance?

Accepted Answer

A)  $12,000 unfavorable 
B)  $12,000 favorable 
C)  $14,000 unfavorable 
D)  $26,000 unfavorable 
A)  $12,000 unfavorable 
B)  $12,000 favorable 
C)  $14,000 unfavorable 
D)  $26,000 unfavorable

Question 8

The formula to compute the direct materials price variance is to calculate the difference between

Accepted Answer

A)  Actual costs - (Actual quantity × Standard price) 
B)  Actual cost + Standard costs 
C)  Actual cost - Standard costs 
D)  (Actual quantity × Standard price) - Standard costs 
A)  Actual costs - (Actual quantity × Standard price) 
B)  Actual cost + Standard costs 
C)  Actual cost - Standard costs 
D)  (Actual quantity × Standard price) - Standard costs

Question 9

The following data relate to direct materials costs for February:
Materials cost per yard: standard, $2.00; actual, $2.10
Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards
Units of production: 9,500
Calculate the direct materials quantity variance.

Accepted Answer

A)  $4,512.50 unfavorable 
B)  $4,512.50 favorable 
C)  $4,750.00 unfavorable 
D)  $4,750.00 favorable 
A)  $4,512.50 unfavorable 
B)  $4,512.50 favorable 
C)  $4,750.00 unfavorable 
D)  $4,750.00 favorable

Question 10

If employees are given bonuses for exceeding normal standards, the standards may be very effective in motivating employees.

Accepted Answer

A) True 
 B)False

Question 11

If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the

Accepted Answer

A)  work in process account 
B)  cost of goods sold account 
C)  finished goods account 
D)  work in process, cost of goods sold, and finished goods accounts 
A)  work in process account 
B)  cost of goods sold account 
C)  finished goods account 
D)  work in process, cost of goods sold, and finished goods accounts

Question 12

Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows: 
Actual costs: 1,550 lbs. at $9.10 
Standard costs: 1,600 lbs. at $9.00
Determine the direct materials:
(a) quantity variance
(b) price variance
(c) total cost variance.

Accepted Answer

The answer of Standard and actual costs for direct materials...

Question 13

Match between columns
                        Premises: (Actual rate per hour - Standard rate per hour) × Actual hours
(Actual direct hours - Standard direct hours) × Standard rate per hour
Standard variable overhead for actual units produced
(Actual price - Standard price) × Actual quantity
(Actual quantity - Standard quantity) × Standard price

Accepted Answer

The Answer of Direct labor rate variance and Direct materials is...

Question 14

The fact that workers are unable to meet a properly determined direct labor standard is sufficient cause to change the standard.

Accepted Answer

A) True 
 B)False

Question 15

Standard costs are a useful management tool that can be used solely as a statistical device apart from the ledger or they can be incorporated in the accounts.

Accepted Answer

A) True 
 B)False

Question 16

Prepare an income statement for the year ended December 31, through the gross profit for Baxter Company using the following information. Baxter Company sold 8,600 units at $125 per unit. Normal production is 9,000 units. (Do not round fixed overhead rate calculation when determining fixed factory overhead volume variance.)

Accepted Answer

@#IMG-DLM& 
*(5 × $6.30) + (2.

Question 17

The Lucy Corporation purchased and used 129,000 board feet of lumber in production, at a total cost of $1,548,000. Original production had been budgeted for 22,000 units with a standard material quantity of 5.7 board feet per unit and a standard price of $12 per board foot. Actual production was 23,500 units.
The materials price variance is

Accepted Answer

A)  $0 
B)  $59,400 unfavorable 
C)  $59,400 favorable 
D)  $6,000 unfavorable 
A)  $0 
B)  $59,400 unfavorable 
C)  $59,400 favorable 
D)  $6,000 unfavorable

Question 18

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

Accepted Answer

A)  The engineering department has revised product specifications in responding to customer suggestions. 
B)  The company has signed a new union contract that increases the factory wages on average by $3.50 an hour. 
C)  Actual costs differed from standard costs for the preceding week. 
D)  The average price of raw materials increased from $4.68 per pound to $4.82 per pound. 
A)  The engineering department has revised product specifications in responding to customer suggestions. 
B)  The company has signed a new union contract that increases the factory wages on average by $3.50 an hour. 
C)  Actual costs differed from standard costs for the preceding week. 
D)  The average price of raw materials increased from $4.68 per pound to $4.82 per pound.

Question 19

An example of a nonfinancial measure is the number of customer complaints.

Accepted Answer

A) True 
 B)False

Question 20

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Accepted Answer

A) True 
 B)False

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

Standards that represent levels of operation that can be attained with reasonable effort are called

The standard price and quantity of direct materials are separated because

The following data relate to direct labor costs for March: Rate: standard, $12.00; actual, $12.25 Hours: standard, 18,500; actual, 17,955 Units of production: 9,450 Calculate the direct labor time variance.

The following data relate to direct materials costs for February: Materials cost per yard: standard, $2.00; actual, $2.10 Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards Units of production: 9,500 Calculate the direct materials price variance.

The formula to compute the direct materials price variance is to calculate the difference between

The following data relate to direct materials costs for February: Materials cost per yard: standard, $2.00; actual, $2.10 Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards Units of production: 9,500 Calculate the direct materials quantity variance.

If employees are given bonuses for exceeding normal standards, the standards may be very effective in motivating employees.

If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the

Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows: Actual costs: 1,550 lbs. at $9.10 Standard costs: 1,600 lbs. at $9.00 Determine the direct materials: (a) quantity variance (b) price variance (c) total cost variance.

The fact that workers are unable to meet a properly determined direct labor standard is sufficient cause to change the standard.

Standard costs are a useful management tool that can be used solely as a statistical device apart from the ledger or they can be incorporated in the accounts.

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

An example of a nonfinancial measure is the number of customer complaints.

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity Based Costing

Cost Volume Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

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Exam 8: Evaluating Variances From Standard Costs

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

Standards that represent levels of operation that can be attained with reasonable effort are called

The standard price and quantity of direct materials are separated because

The following data relate to direct labor costs for March: Rate: standard, $12.00; actual, $12.25 Hours: standard, 18,500; actual, 17,955 Units of production: 9,450 Calculate the direct labor time variance.

The following data relate to direct materials costs for February: Materials cost per yard: standard, $2.00; actual, $2.10 Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards Units of production: 9,500 Calculate the direct materials price variance.

The formula to compute the direct materials price variance is to calculate the difference between

The following data relate to direct materials costs for February: Materials cost per yard: standard, $2.00; actual, $2.10 Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards Units of production: 9,500 Calculate the direct materials quantity variance.

If employees are given bonuses for exceeding normal standards, the standards may be very effective in motivating employees.

If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the

Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows: Actual costs: 1,550 lbs. at $9.10 Standard costs: 1,600 lbs. at $9.00 Determine the direct materials: (a) quantity variance (b) price variance (c) total cost variance.

The fact that workers are unable to meet a properly determined direct labor standard is sufficient cause to change the standard.

Standard costs are a useful management tool that can be used solely as a statistical device apart from the ledger or they can be incorporated in the accounts.

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

An example of a nonfinancial measure is the number of customer complaints.

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity Based Costing

Cost Volume Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

Filters