Exam 8: Standard Cost Accounting--Materials, labor, and Factory Overhead

One possible explanation for a company that experiences a favorable labor efficiency variance,but an unfavorable labor rate variance could be:

In a three-variance method of factory overhead analysis,the variance that indicates that the volume of production was more or less than budgeted is the:

In a four-variance method analyzing factory overhead,the variable factory overhead spending variance measures:

Baker Company has a standard and flexible budgeting system and uses a two-variance analysis of factory overhead.Selected data for the June production activity follows: The production-volume variance for June is:

If the total materials variance (actual cost of materials used compared with the standard cost of the standard amount of materials required)for a given operation is favorable,why must this variance be further evaluated as to price and usage?

The Jurcevich Corporation manufactures and sells a single product.A standard cost system is used by the company.The standard factory overhead cost for a unit of product is as follows: The overhead cost per unit was calculated for the year based on a 60,000 unit volume as follows: The charges to the manufacturing department for April are given below for the 5,200 units produced: (a)Assuming Jurcevich uses the two-variance method of analyzing factory overhead,calculate the following variances from standard cost: (b)Prepare the journal entry to apply factory overhead to work in process and record the variances.

Underapplied factory overhead would result if:

Donellan Company has a standard and flexible budgeting system and uses a two-variance analysis of factory overhead.Selected data for the February production activity follows: The flexible-budget variance for February is:

To effectively use variances to improve operations,management should take the following steps except:

Thomas Company uses a standard cost system and recognizes the materials purchase price variance at the time materials are purchased.Information for raw materials for Product RBI for the month of October follows: What is the materials quantity variance?

Woodside Company manufactures tables with vinyl tops.The standard material cost for the vinyl used per Style-R table is $7.20 based on 8 square feet of vinyl at a cost of $.90 per square foot.A production run of 1,000 tables in January resulted in usage of 8,400 square feet of vinyl at a cost of $.85 per square foot,a total cost of $7,055.The materials quantity variance resulting from the above production run was:

Alyssa Corporation uses a standard cost system.Direct labor information for Product CER for the month of October is as follows: What are actual hours worked?

An unfavorable labor efficiency variance is the:

How should an efficiency variance that is material in amount be treated at the end of an accounting period?

Which of the following terms best identifies the function of standard costs where any deviation from standards can be quickly detected and responsibility pinpointed so appropriate action may be taken?

Perez Company adopted a standard cost system several years ago.The standard costs for the prime costs of its single product follow: The following operating data were taken from the records for November: Compute the following: a.Labor rate variance b.Labor efficiency variance c.Actual kilograms of material used in the production process d.Actual cost paid per kilogram of material

When computing variances from standard costs,the difference between actual and standard price multiplied by actual quantity yields:

Rhodes Corporation manufactures a product with the following standard costs: Standards are based on normal monthly production involving 2,000 direct labor hours (500 units of output). The following information pertains to the month of July: a.Compute the following variances for the month of July,indicating whether each variance is favorable or unfavorable: (1) Materials purchase price variance (2) Materials quantity variance (3) Labor rate variance (4) Labor efficiency variance b.Give potential reasons for each of the variances.Be sure to consider inter-relationships among variances.

When performing input-output variance analysis in standard costing,"standard hours allowed" is a means of measuring:

Glandorf Controls produces furnaces at several plants.The business is seasonal and cyclical in nature.The accountant for the Marion plant uses flexible budgeting to help the plant management control operations.Data for Marion follows: a.Compute the fixed and variable factory overhead application rates per unit of production. b.Assuming Glandorf uses the two-variance method of analyzing factory overhead,compute the two overhead variances. c.Prepare a flexible budget performance report for January comparing actual and budgeted costs of all cost elements for the actual activity for the month. d.Prove the factory overhead budget variance from the above report.