Exam 7: Performance Evaluation Using Variances From Standard Costs

The following data relate to direct labor costs for the current period: Standard costs 9,000 hours at $5.50 Actual costs 8,500 hours at $5.75 What is the direct labor rate variance?

A company records its inventory purchases at standard cost but also records purchase price variances.The company purchased 5,000 widgets at $8.00 each, and the standard cost for the widgets is $7.60.Which of the following would be included in the journal entry?

A favorable cost variance occurs when

Periodic comparisons between planned objectives and actual performance are reported in:

Accounting systems that use standards for product costs are called budgeted cost systems.

The principle of exceptions allows managers to focus on correcting variances between

Prepare an income statement through income before income tax for presentation to management, using the following data from the records of Greenway Manufacturing Company for November of the current year:

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.

At the end of the fiscal year, variances from standard costs are usually transferred to the

Compute the standard cost for one pair of boots, based on the following standards for each pair of boots: Standard material quantity: 1.25 yards of leather at $35.00 per yard Standard labor: 9 hours at $25.75 per hour Factory overhead: $1.75 per direct labor hour

A variable cost system is an accounting system where standards are set for each manufacturing cost element.

Normally, standard costs should be revised when labor rates change to incorporate new union contracts.

The formula to compute the direct labor rate variance is to calculate the difference between

The principle of exceptions allows managers to focus on correcting variances between standard costs and actual costs.

The materials price variance is

The following are inputs and outputs to the help desk: operator training number of calls per day maintenance of computer equipment number of operators number of complaints Identify whether each is an input or an output to the help desk.

What is the amount of the fixed factory overhead volume variance?

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

The standard price and quantity of direct materials are separated because

Which of the following would not lend itself to applying direct labor variances?