Exam 14: Operational Performance Measurement: Sales, Direct-Cost Variances, and the Role of Nonfinancial Performance Measures

Luanna Inc. manufactures game consoles. Some of the company's data was misplaced. Use the following information to replace the lost data.The amount A is:

In September, Larson Inc. sold 40,000 units of its only product for $240,000, and incurred a total cost of $225,000, of which $25,000 was fixed costs. The flexible budget for September showed total sales of $300,000. Among variances of the period were: total variable cost flexible-budget variance, $8,000U; total flexible-budget variance, $63,000U; and, sales volume variance, in terms of contribution margin, $27,000U. The sales volume variance, in terms of operating income, for September (to the nearest dollar) was:

Which one of the following is defined as the difference between the actual direct labor hours worked and the standard direct labor hours allowed for the units manufactured, multiplied by the standard hourly wage rate per hour?

An organization planned to use $82.00 of direct materials per unit of output, but it actually used $80 per unit. During this period, the company planned to make 1,200 units, but produced only 1,000 units. The flexible budget amount for direct materials cost is:

Which one of the following is defined as the difference between the actual hourly wage rate and the standard hourly wage rate, multiplied by the actual number of direct labor hours (DLHs) worked during a period?

A favorable price variance for direct materials indicates that:

For operational control, a management accounting system should include:

Joe Malay received the following report on the Division's operation for the month of August: Direct labor rate variance = $25,000 unfavorable; Direct labor efficiency variance = $70,000 (?). The standard calls for 3.0 direct labor hours per unit of output at $28.00 per labor hour (SP). The standard direct labor hours allowed for the units manufactured (SQ) is 20 percent more than the total direct labor hours worked (AQ) in August. What was the average direct labor hourly rate (AP) the Division paid in August, to two decimal places?

A standard that assumes perfect implementation and maximum efficiency is called a(n):

Shade Company adopted a standard cost system several years ago. The standard costs for direct labor and direct materials for its single product are as follows: Materials (5 kilograms × $12.00/kilogram) = $60.00/unit; direct labor (3.5 hours/unit × $20.00/hour) = $70.00/unit. All materials are issued at the beginning of processing. The operating data shown below were taken from the records for December: The direct labor flexible-budget variance for December (rounded to the nearest dollar) was:

Sheldon Company manufactures only one product and uses a standard cost system. During the past month, manufacturing operations for the company had the following variances: direct labor rate variance = $30,000 favorable; direct labor efficiency variance = $50,000 unfavorable. Sheldon allows 5 standard direct labor hours per unit produced, and its standard direct labor hourly pay rate is $50. During the month, the company used 25% more direct labor hours than the standard allowed for the output achieved. What were the total actual direct hours worked (AQ), rounded to the nearest whole number?

Information concerning Johnston Co.'s direct materials costs is as follows:The direct materials usage variance for the period, rounded to two decimal places, is:

Which one of the following, for each direct material used in production, is defined as the difference between the actual units of material used and the total standard units of the direct material that should have been used for the units of the product manufactured during the period, multiplied by the standard unit price of the direct material?

Flexible budgets and standard costs, if used appropriately, can be useful for assessing:

In September, Larson Inc. sold 40,000 units of its only product for $240,000, and incurred a total cost of $225,000, of which $25,000 was fixed costs. The flexible budget for September showed total sales of $300,000. Among variances of the period were: total variable cost flexible-budget variance, $8,000U; total flexible-budget variance, $63,000U; and, sales volume variance, in terms of contribution margin, $27,000U. The budgeted fixed cost for September, to the nearest dollar, was:

A ________ standard gets progressively tighter over time.

A company's master budget for October is to manufacture and sell 30,000 units, for a total sales revenue of $270,000, total variable costs of $180,000, and total fixed costs of $24,000. The company actually manufactured and sold 32,000 units, and generated $45,000 of operating income in October. The total flexible-budget (FB) variance for operating income in October, to the nearest dollar, was:

An organization subject to intense competitive pressures would most likely use:

Machine Builders Inc. adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows:The direct materials usage variance for July, to the nearest dollar, was:

Machine Builders Inc. adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows:The direct labor flexible-budget variance for July, to the nearest dollar, was: