Wimberley Company Wimberley Company has the following information available for December when 3,500 units were produced (round answers to the nearest dollar). $\begin{array}{ll} \text { Standards: } & 3.5 \text { pounds } \\ \text { Material } & \text { per unit @ } \\ & \$ 4.50 \text { per } \\ & \text { pound } \\ & 5.0 \text { hours } \\ \text { Labor } & \text { per unit @ } \\ & \$ 10.25 \text { per } \\ & \text { hour } \end{array}$ $\begin{array}{ll} \text { Actual: } & \\ \text { Material purchased } & 12,300 \\ & \text { pounds } @ \\ & \$ 4.25 \\ \text { Material used } & 11,750 \\ & \text { pounds } \\ 17,300 \text { direct1abor hours @ } & \end{array}$ $\$ 10.20 \text { per hour }$ Refer to Wimberley Company.What is the material quantity variance?

A) $2,250 F B) $2,250 U C) $225 F D) $2,475 U A) $2,250 F B) $2,250 U C) $225 F D) $2,475 U

Cibolo Company Cibolo Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar). $\begin{array}{ll} \text { Standards: } &4.0 \text { pounds } \\ \text { Material } & \text { per unit @ } \\ & \$ 5.25 \text { per } \\ & \text { pound } \\ & 6.0 \text { hours } \\ \text { Labor } & \text { per unit @ } \\ & \$ 10.00 \text { per } \\ & \text { hour } \end{array}$ $\begin{array}{ll} \text { Actual: } & \\ \text { Material purchased } & 17,500 \\ & \text { pounds } @ \\ & \$ 5.10 \\ \text { Material used } & 16,700 \\ & \text { pounds } \\ 25,500 \text { direct1abor hours @ } & \end{array}$ $\$9.85 \text { per hour }$ Refer to Cibolo Company.What is the labor efficiency variance?

A) $ 2,955 F B) $ 2,955 U C) $ 3,000 U D) $ 3,000 F A) $ 2,955 F B) $ 2,955 U C) $ 3,000 U D) $ 3,000 F

Patterson Company The following information is for Patterson Company's July production: $\begin{array}{l} \text { Standards: }\\ \begin{array}{ll} \text { Material } & 3.0 \text { feet per unit@ } \$ 4.20 \text { per foot } \\ \text { Labor } & 2.5 \text { hours per unit@ } \$ 7.50 \text { per hour } \end{array} \end{array}$ $\begin{array}{l} \text { Actual: }\\ \begin{array}{ll} \text { Production } & 2,750 \text { units produced during the month } \\ \text { Material } & 8,700 \text { feet used; } 9,000 \text { feet purchased @ } \$ 4.50 \text { per foo } \\ \text { Labor } & 7,000 \text { direct labor hours@ } \$ 7.90 \text { per hour } \end{array} \end{array}$ (Round all answers to the nearest dollar. ) Refer to Patterson Company.What is the labor efficiency variance?

A) $1,875 U B) $ 938 U C) $1,875 F D) $1,125 U A) $1,875 U B) $ 938 U C) $1,875 F D) $1,125 U

Brennan Company The following information is for Brennan Company's September production: $\begin{array}{l} \text { Standards: }\\ \begin{array}{ll} \text { Material } & 4.0 \text { feet per unit@ } \$ 4.20 \text { per foot } \\ \text { Labor } &3.0 \text { hours per unit@ } \$ 7.50 \text { per hour } \end{array} \end{array}$ $\begin{array}{l} \text { Actual: }\\ \begin{array}{ll} \text { Production } & 3,500 \text { units produced during the month } \\ \text { Material } & 14,200 \text { feet used; } 14,700 \text { feet purchased @ } \$ 3.70 \text { per foo } \\ \text { Labor } & 10,400 \text { direct labor hours@ } \$ 8.35 \text { per hour } \end{array} \end{array}$ (Round all answers to the nearest dollar. ) Refer to Brennan Company.What is the material price variance (calculated at point of purchase)?

A) $ 735 F B) $ 735 U C) $ 710 F D) $ 710 U A) $ 735 F B) $ 735 U C) $ 710 F D) $ 710 U

Exam 7: Standard Costing and Variance Analysis

Wimberley Company Wimberley Company has the following information available for December when 3,500 units were produced (round answers to the nearest dollar). Standards: 3.5 pounds Material per unit @ \ 4.50 per pound 5.0 hours Labor per unit @ \ 10.25 per hour Actual: Material purchased 12,300 pounds @ \ 4.25 Material used 11,750 pounds 17,300 direct1abor hours @ $\$ 10.20 \text { per hour }$ Refer to Wimberley Company.What is the material quantity variance?

(Multiple Choice)

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Question 181

A company may set predetermined overhead rates based on normal,expected annual,or theoretical capacity.At the end of a period,the fixed overhead spending variance would

(Multiple Choice)

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Question 182

Actual fixed overhead is $33,300 (12,000 machine hours)and fixed overhead was estimated at $34,000 when the predetermined rate of $3.00 per machine hour was set.If 11,500 standard hours were allowed for actual production,applied fixed overhead is

(Multiple Choice)

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Question 183

When multiple labor categories are used,the financial effect of using a different mix of workers in a production process is referred to as a labor yield variance.

(True/False)

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Question 184

Practical standards are the most effective standards for controlling and motivating workers.

(True/False)

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Question 185

The total variance does not provide useful information about the source of cost differences.

(True/False)

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Question 186

Cibolo Company Cibolo Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar). Standards: 4.0 pounds Material per unit @ \ 5.25 per pound 6.0 hours Labor per unit @ \ 10.00 per hour Actual: Material purchased 17,500 pounds @ \ 5.10 Material used 16,700 pounds 25,500 direct1abor hours @ $\$9.85 \text { per hour }$ Refer to Cibolo Company.What is the labor efficiency variance?

(Multiple Choice)

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Question 187

Specifications for materials are compiled on a purchase requisition.

(True/False)

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Question 188

The total variance can provide useful information about the source of cost differences.

(True/False)

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Question 189

Pearce Company Pearce Company uses a standard cost system for its production process.Pearce Company applies overhead based on direct labor hours.The following information is available for July:

Standard:

DLH per unit 2.20

Variable overhead per DLH $2.50

Fixed overhead per DLH

Budgeted variable overhead $3.00

(based on 11,990 DLHs)

Actual:
Units produced 4,400

Direct labor hours 8,800

Variable overhead $29,950

Fixed overhead $42,300

Refer to Pearce Company Using the two-variance approach,what is the controllable variance?

(Multiple Choice)

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Question 190

In analyzing manufacturing overhead variances,the volume variance is the difference between the

(Multiple Choice)

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Question 191

The standard cost card contains quantities and costs for

(Multiple Choice)

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Question 192

Commodore Company Commodore Company uses a standard cost system for its production process and applies overhead based on direct labor hours.The following information is available for September when Commodore produced 5,000 units:

Standard:

DLH per unit 3.00

Variable overhead per DLH $1.80

Fixed overhead per DLH $3.25

Budgeted variable overhead $27,250

Budgeted fixed overhead $49,500

Actual:

Direct labor hours 16,000

Variable overhead $31,325

Fixed overhead $49,750

Refer to Commodore Company.Using the one-variance approach,what is the total overhead variance?

(Multiple Choice)

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Question 193

Commodore Company Commodore Company uses a standard cost system for its production process and applies overhead based on direct labor hours.The following information is available for September when Commodore produced 5,000 units:

Standard:

DLH per unit 3.00

Variable overhead per DLH $1.80

Fixed overhead per DLH $3.25

Budgeted variable overhead $27,250

Budgeted fixed overhead $49,500

Actual:

Direct labor hours 16,000

Variable overhead $31,325

Fixed overhead $49,750

Refer to Commodore Company.Using the four-variance approach,what is the volume variance?

(Multiple Choice)

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Question 194

Industrial Solutions Company Industrial Solutions Company manufactures a cleaning solvent.The company employs both skilled and unskilled workers.To produce one 55-gallon drum of solvent requires Materials A and B as well as skilled labor and unskilled labor.The standard and actual material and labor information is presented below: Standard: Material A: 30.25 gallons @ $1.25 per gallon Material B: 24.75 gallons @ $2.00 per gallon Skilled Labor: 4 hours @ $12 per hour Unskilled Labor: 2 hours @ $ 7 per hour Actual: Material A: 10,716 gallons purchased and used @ $1.50 per gallon Material B: 17,484 gallons purchased and used @ $1.90 per gallon Skilled labor hours: 1,950 @ $11.90 per hour Unskilled labor hours: 1,300 @ $7.15 per hour During the current month Industrial Solutions Company manufactured 500 55-gallon drums. Round all answers to the nearest whole dollar. Refer to Industrial Solutions Company.What is the total material mix variance?

(Multiple Choice)

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Question 195

Patterson Company The following information is for Patterson Company's July production: Standards: Material 3.0 feet per unit@ \ 4.20 per foot Labor 2.5 hours per unit@ \ 7.50 per hour Actual: Production 2,750 units produced during the month Material 8,700 feet used; 9,000 feet purchased @ \ 4.50 per foo Labor 7,000 direct labor hours@ \ 7.90 per hour (Round all answers to the nearest dollar. ) Refer to Patterson Company.What is the labor efficiency variance?

(Multiple Choice)

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Question 196

Brennan Company The following information is for Brennan Company's September production: Standards: Material 4.0 feet per unit@ \ 4.20 per foot Labor 3.0 hours per unit@ \ 7.50 per hour Actual: Production 3,500 units produced during the month Material 14,200 feet used; 14,700 feet purchased @ \ 3.70 per foo Labor 10,400 direct labor hours@ \ 8.35 per hour (Round all answers to the nearest dollar. ) Refer to Brennan Company.What is the material price variance (calculated at point of purchase)?

(Multiple Choice)

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Question 197

Buckingham Company Buckingham Company uses a standard cost system for its production process and applies overhead based on direct labor hours.The following information is available for May when Buckingham produced 4,500 units:

Standard:

DLH per unit 2.50

Variable overhead per DLH $1.75

Fixed overhead per DLH $3.10

Budgeted variable overhead $21,875

Budgeted fixed overhead $38,750

Actual:

Direct labor hours 10,000

Variable overhead $26,250

Fixed overhead $38,000

Refer to Buckingham Company.Using the four-variance approach,what is the variable overhead efficiency variance?

(Multiple Choice)

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Question 198

Favorable variances are always desirable for production.

(True/False)

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Question 199

The difference between budgeted variable overhead for actual hours and standard overhead is the variable overhead spending variance.

(True/False)

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Question 200

A company may set predetermined overhead rates based on normal,expected annual,or theoretical capacity.At the end of a period,the fixed overhead spending variance would

Actual fixed overhead is $33,300 (12,000 machine hours)and fixed overhead was estimated at $34,000 when the predetermined rate of $3.00 per machine hour was set.If 11,500 standard hours were allowed for actual production,applied fixed overhead is

When multiple labor categories are used,the financial effect of using a different mix of workers in a production process is referred to as a labor yield variance.

Practical standards are the most effective standards for controlling and motivating workers.

The total variance does not provide useful information about the source of cost differences.

Specifications for materials are compiled on a purchase requisition.

The total variance can provide useful information about the source of cost differences.

In analyzing manufacturing overhead variances,the volume variance is the difference between the

The standard cost card contains quantities and costs for

Favorable variances are always desirable for production.

The difference between budgeted variable overhead for actual hours and standard overhead is the variable overhead spending variance.

Introduction to Cost Accounting

Cost Terminology and Cost Behaviors

Predetermined Overhead Rates, Flexible Budgets, and Absorptionvariable Costing

Activity-Based Management and Activity-Based Costing

Job Order Costing

Process Costing

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting,support Department Allocations,and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters

Standard:
DLH per unit	2.20
Variable overhead per DLH	$2.50
Fixed overhead per DLH
Budgeted variable overhead	$3.00
(based on 11,990 DLHs)

Actual:
Units produced	4,400
Direct labor hours	8,800
Variable overhead	$29,950
Fixed overhead	$42,300

Standard:
DLH per unit	3.00
Variable overhead per DLH	$1.80
Fixed overhead per DLH	$3.25
Budgeted variable overhead	$27,250
Budgeted fixed overhead	$49,500

Actual:
Direct labor hours	16,000
Variable overhead	$31,325
Fixed overhead	$49,750

Standard:
DLH per unit	2.50
Variable overhead per DLH	$1.75
Fixed overhead per DLH	$3.10
Budgeted variable overhead	$21,875
Budgeted fixed overhead	$38,750

Actual:
Direct labor hours	10,000
Variable overhead	$26,250
Fixed overhead	$38,000