Question 1

The actual hourly rate paid above or below the standard hourly rate,multiplied by the actual number of hours worked is the:

Accepted Answer

A) Labor rate variance. 
B) Labor efficiency variance. 
C) Labor usage variance. 
D) Labor direct variance. 
A) Labor rate variance. 
B) Labor efficiency variance. 
C) Labor usage variance. 
D) Labor direct variance.

Question 2

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 purchase price variance?

Accepted Answer

A) $590 favorable 
B) $590 unfavorable 
C) $600 favorable 
D) $600 unfavorable 
A) $590 favorable 
B) $590 unfavorable 
C) $600 favorable 
D) $600 unfavorable

Question 3

The following information pertains to Skandalis Company's production of one unit of its manufactured product during the month of June:   (a)The materials price variance is recognized when materials are purchased.Compute materials price and quantity variances and labor rate and efficiency variances.
(b)Prepare the journal entries to record:
(1)the purchase of the materials,
(2)putting materials into production,and
(3)direct labor costs.

Accepted Answer

@#IMG-DLM& *Actual production x lbs.allowed per un

Question 4

In the three-variance method of factory overhead analysis,what standard cost variance represents the difference between actual factory overhead incurred and budgeted factory overhead based on actual hours worked?

Accepted Answer

A) Production-volume variance 
B) Efficiency variance 
C) Spending variance 
D) Quantity variance 
A) Production-volume variance 
B) Efficiency variance 
C) Spending variance 
D) Quantity variance

Question 5

Lee Company's direct labor costs for the month of February follow:   What was Lee's standard direct labor rate?

Accepted Answer

A) $9.50 
B) $9.75 
C) $9.40 
D) $9.25 
A) $9.50 
B) $9.75 
C) $9.40 
D) $9.25

Question 6

The following information pertains to the Braun Company for March:   Using the four-variance method of factory overhead variance analysis,what is the variable overhead efficiency variance?

Accepted Answer

A) $1,200 unfavorable 
B) $200 unfavorable 
C) $1,000 favorable 
D) $200 favorable 
A) $1,200 unfavorable 
B) $200 unfavorable 
C) $1,000 favorable 
D) $200 favorable

Question 7

RHO Company began its operations on January 1 and produces a single product that sells for $10.25 per unit.Standard capacity is 80,000 units per year.The 80,000 units were produced and 70,000 units were sold during the year. Manufacturing costs and selling and administrative expenses follow:   What is the standard cost of manufacturing a unit of product?

Accepted Answer

A) $6.50 
B) $7.00 
C) $5.50 
D) $6.00 
A) $6.50 
B) $7.00 
C) $5.50 
D) $6.00

Question 8

In a three-variance method of factory overhead analysis,the variance that measures the difference between the factory overhead applied and the actual hours worked multiplied by the standard rate is the:

Accepted Answer

A) Production-volume variance. 
B) Quantity variance. 
C) Spending variance. 
D) Efficiency variance. 
A) Production-volume variance. 
B) Quantity variance. 
C) Spending variance. 
D) Efficiency variance.

Question 9

What type of direct material variances for price and quantity will arise if the actual number of pounds of materials used exceeds standard pounds allowed but actual cost was less than standard cost?

Accepted Answer

A) Favorable Favorable 
B) Unfavorable Favorable 
C) Favorable Unfavorable 
D) Unfavorable Unfavorable 
A) Favorable Favorable 
B) Unfavorable Favorable 
C) Favorable Unfavorable 
D) Unfavorable Unfavorable

Question 10

The following information pertains to the Braun Company for March:   Using the four-variance method of factory overhead variance analysis,what is the fixed overhead spending variance?

Accepted Answer

A) $1,200 favorable 
B) $1,800 unfavorable 
C) $3,000 favorable 
D) $1,200 unfavorable 
A) $1,200 favorable 
B) $1,800 unfavorable 
C) $3,000 favorable 
D) $1,200 unfavorable

Question 11

The following information is available from the Arugula Company:   Assuming that Arugula uses a three-variance analysis of overhead variances,what is the efficiency variance?

Accepted Answer

A) $500 unfavorable 
B) $475 unfavorable 
C) $975 unfavorable 
D) $175 unfavorable 
A) $500 unfavorable 
B) $475 unfavorable 
C) $975 unfavorable 
D) $175 unfavorable

Question 12

Kale Corporation's budgeted fixed factory overhead costs are $25,000 per month plus a variable factory overhead rate of $8.00 per direct labor hour.The standard direct labor hours allowed for November production were 10,000.An analysis of the factory overhead indicates that in November Kale had a favorable flexible-budget variance of $1,500 and an unfavorable production-volume variance of $500.Kale uses a two-variance analysis of overhead variances. The actual factory overhead incurred in October is:

Accepted Answer

A) $105,500. 
B) $104,500. 
C) $106,500. 
D) $103,500. 
A) $105,500. 
B) $104,500. 
C) $106,500. 
D) $103,500.

Question 13

A manufacturer generally wants to set a standard that:

Accepted Answer

A) Can be achieved only under the most efficient operating conditions. 
B) Is high enough to provide motivation and promote efficiency,but is still attainable. 
C) Makes no allowance for normal waste or spoilage. 
D) None of these is correct. 
A) Can be achieved only under the most efficient operating conditions. 
B) Is high enough to provide motivation and promote efficiency,but is still attainable. 
C) Makes no allowance for normal waste or spoilage. 
D) None of these is correct.

Question 14

Which of the following is not likely to have caused a materials price variance?

Accepted Answer

A) The vendor from whom we always bought component XYZ closed and we found a new one. 
B) One of the workers inadvertently cut several pieces of steel to the wrong length. 
C) We started using a higher grade of lumber in our process. 
D) Higher oil prices have increased the costs of shipping the ingredients to us. 
A) The vendor from whom we always bought component XYZ closed and we found a new one. 
B) One of the workers inadvertently cut several pieces of steel to the wrong length. 
C) We started using a higher grade of lumber in our process. 
D) Higher oil prices have increased the costs of shipping the ingredients to us.

Question 15

If a company uses a two-variance analysis for overhead variances and uses a predetermined rate for absorbing manufacturing overhead,the production-volume variance is the:

Accepted Answer

A) Underapplied or overapplied variable cost element of overhead. 
B) Underapplied or overapplied fixed cost element of overhead. 
C) Difference in budgeted costs and actual costs of fixed overhead items. 
D) Difference in budgeted costs and actual costs of variable overhead items. 
A) Underapplied or overapplied variable cost element of overhead. 
B) Underapplied or overapplied fixed cost element of overhead. 
C) Difference in budgeted costs and actual costs of fixed overhead items. 
D) Difference in budgeted costs and actual costs of variable overhead items.

Question 16

Earl Company's direct labor costs for the month of January follow:   What was Earl's direct labor efficiency variance?

Accepted Answer

A) $6,500 favorable 
B) $6,400 unfavorable 
C) $1,800 favorable 
D) $6,400 favorable 
A) $6,500 favorable 
B) $6,400 unfavorable 
C) $1,800 favorable 
D) $6,400 favorable

Question 17

Ben's Climbing Gear,Inc.has direct material costs as follows:   What was Ben's standard quantity of material allowed?

Accepted Answer

A) 18,000 
B) 24,000 
C) 20,000 
D) 22,000 
A) 18,000 
B) 24,000 
C) 20,000 
D) 22,000

Question 18

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 budgeted fixed overhead.
b.Assuming Rhodes uses the two-variance method of analyzing factory overhead,computer the following variances for the month of July,indicating whether each variance is favorable or unfavorable:
(1)
Factory overhead flexible-budget variance
(2)
Factory overhead production-volume variance

Accepted Answer

@#IMG-DLM& @#IMG-DLM& (budgeted overhead

Question 19

Factors to be considered in setting materials standards include all of the following except:

Accepted Answer

A) Trend of prices of raw materials. 
B) Historical costs. 
C) Time necessary to assemble parts. 
D) New production processes or market developments. 
A) Trend of prices of raw materials. 
B) Historical costs. 
C) Time necessary to assemble parts. 
D) New production processes or market developments.

Question 20

The data below relate to the month of April for Monroe,Inc. ,which uses a standard cost system and a two-variance analysis of factory overhead:   What was Monroe's production-volume variance for April?

Accepted Answer

A) $4,250 favorable 
B) $4,250 unfavorable 
C) $52,812.50 favorable 
D) $52,812.50 unfavorable 
A) $4,250 favorable 
B) $4,250 unfavorable 
C) $52,812.50 favorable 
D) $52,812.50 unfavorable

The actual hourly rate paid above or below the standard hourly rate,multiplied by the actual number of hours worked is the:

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 purchase price variance?

In the three-variance method of factory overhead analysis,what standard cost variance represents the difference between actual factory overhead incurred and budgeted factory overhead based on actual hours worked?

Lee Company's direct labor costs for the month of February follow: What was Lee's standard direct labor rate?

The following information pertains to the Braun Company for March: Using the four-variance method of factory overhead variance analysis,what is the variable overhead efficiency variance?

In a three-variance method of factory overhead analysis,the variance that measures the difference between the factory overhead applied and the actual hours worked multiplied by the standard rate is the:

What type of direct material variances for price and quantity will arise if the actual number of pounds of materials used exceeds standard pounds allowed but actual cost was less than standard cost?

The following information pertains to the Braun Company for March: Using the four-variance method of factory overhead variance analysis,what is the fixed overhead spending variance?

The following information is available from the Arugula Company: Assuming that Arugula uses a three-variance analysis of overhead variances,what is the efficiency variance?

A manufacturer generally wants to set a standard that:

Which of the following is not likely to have caused a materials price variance?

If a company uses a two-variance analysis for overhead variances and uses a predetermined rate for absorbing manufacturing overhead,the production-volume variance is the:

Earl Company's direct labor costs for the month of January follow: What was Earl's direct labor efficiency variance?

Ben's Climbing Gear,Inc.has direct material costs as follows: What was Ben's standard quantity of material allowed?

Factors to be considered in setting materials standards include all of the following except:

The data below relate to the month of April for Monroe,Inc. ,which uses a standard cost system and a two-variance analysis of factory overhead: What was Monroe's production-volume variance for April?

Introduction to Cost Accounting

Accounting for Materials

Accounting for Labor

Accounting for Factory Overhead

Process Cost Accounting--General Procedures

Process Cost Accounting--Additional Procedures

Master Budget and Flexible Budgeting

Cost Accounting for Service Businesses

Cost Analysis for Management Decision Making

Filters

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

The actual hourly rate paid above or below the standard hourly rate,multiplied by the actual number of hours worked is the:

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 purchase price variance?

In the three-variance method of factory overhead analysis,what standard cost variance represents the difference between actual factory overhead incurred and budgeted factory overhead based on actual hours worked?

Lee Company's direct labor costs for the month of February follow: What was Lee's standard direct labor rate?

The following information pertains to the Braun Company for March: Using the four-variance method of factory overhead variance analysis,what is the variable overhead efficiency variance?

In a three-variance method of factory overhead analysis,the variance that measures the difference between the factory overhead applied and the actual hours worked multiplied by the standard rate is the:

What type of direct material variances for price and quantity will arise if the actual number of pounds of materials used exceeds standard pounds allowed but actual cost was less than standard cost?

The following information pertains to the Braun Company for March: Using the four-variance method of factory overhead variance analysis,what is the fixed overhead spending variance?

The following information is available from the Arugula Company: Assuming that Arugula uses a three-variance analysis of overhead variances,what is the efficiency variance?

A manufacturer generally wants to set a standard that:

Which of the following is not likely to have caused a materials price variance?

If a company uses a two-variance analysis for overhead variances and uses a predetermined rate for absorbing manufacturing overhead,the production-volume variance is the:

Earl Company's direct labor costs for the month of January follow: What was Earl's direct labor efficiency variance?

Ben's Climbing Gear,Inc.has direct material costs as follows: What was Ben's standard quantity of material allowed?

Factors to be considered in setting materials standards include all of the following except:

The data below relate to the month of April for Monroe,Inc. ,which uses a standard cost system and a two-variance analysis of factory overhead: What was Monroe's production-volume variance for April?

Introduction to Cost Accounting

Accounting for Materials

Accounting for Labor

Accounting for Factory Overhead

Process Cost Accounting--General Procedures

Process Cost Accounting--Additional Procedures

Master Budget and Flexible Budgeting

Cost Accounting for Service Businesses

Cost Analysis for Management Decision Making

Filters