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

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: All materials are issued at the beginning of processing.The operating data shown below were taken from the records for July: The sales volume variance,measured in terms of direct labor cost,for July was:

A company's master budget for October is to manufacture and sell 30,000 units for a total of $270,000 with 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 operating income flexible-budget (FB)variance is:

One important short-term goal for a company is to earn the projected operating income for the period.Attainment of this goal is measured by comparing the actual operating income to the:

Sheldon Company manufactures only one product and uses a standard cost system.During the past month,the manufacturing operations 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 rate is $50.During the month,the company used 25 percent more direct labor hours than the standard allowed.What were the total actual direct hours worked?

All of the following are limitations of short-term financial performance indicators except:

The way managers and employees who are affected by a standard cost system perceive the system will:

By convention,short-term financial control is accomplished by all the following except:

Fill in the unknowns A through S below.

For control purposes,it is usually preferable to calculate the materials price variance:

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

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

Flexible budgets and standard costs are useful for assessing:

Minmax Co.'s direct labor information for February is as follows: The direct labor efficiency variance in February is:

Matinna Co.maintains no inventories and has the following data pertaining to one of its direct materials in July: What was the company's direct materials flexible-budget (FB)variance for July?

Pokeman Bunch Inc. ,manufactures PokeMonster figures and has the following data from its operation for the year just completed. The amount D is:

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 x $12.00 per kilogram)= $60.00/unit.Direct labor (3.5 hours x $20.00 per hour)= $70.00/unit.All materials were issued at the beginning of processing.The operating data shown below were taken from the records for December: The actual direct materials purchase price per kilogram is:

Contemporary furniture manufactures office desks.The firm budgeted to sell 5,000 desks at $200 per desk in 2010.Budgeted costs include $80 variable cost per desk,and $200,000 fixed cost/year.In 2010 the company sold 6,000 desks at $190,and incurred $78 variable cost per desk and $220,000 fixed cost for the year. Required: Prepare,in proper form,a variance analysis report identifying both flexible budget and sales-volume variances.

Norio Manufacturing uses powdered plastics (PPS)to manufacture a high-pressure board used in digital equipment,Flex 10.Information concerning its operation in June was as follows: The actual purchase price per pound of PPS used is:

Which one of the following,for each direct material used in production,is 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 materials?

A flexible-budget variance measures the impact on short-term operating profit of: