Deck 10: Standard Costs and Variances

Question 1

Which of the following would produce a materials price variance?

A)An excess quantity of materials used.
B)An excess number of direct labor-hours worked in completing a job.
C)Shipping materials to the plant by air freight rather than by truck.
D)Breakage of materials in production.

Answer 1

C

Question 2

The standard price per unit for direct materials should not include the cost of delivering the materials.

Answer 2

False

Question 3

The Swenson Corporation has a standard costing system.The following data are available for June: The actual price per pound of direct materials purchased in June is:

A)$3.92
B)$4.32
C)$4.08
D)$4.20

Answer 3

D
Explanation: Materials price variance = AQ × (AP - SP)
$7,000 U = 35,000 pounds × (AP - $4 per pound)
$7,000 = 35,000 pounds × (AP - $4 per pound)
AP - $4 per pound = $7,000 ÷ 35,000 pounds
AP - $4 per pound = $0.20 per pound
AP = $4 per pound + $0.20 per pound
AP = $4.20 per pound

Question 4

A favorable materials quantity variance occurs when the actual quantity used in production is less than the standard quantity allowed for the actual output of the period.

Question 5

The variance that is usually most useful in assessing the performance of the purchasing department manager is:

A)the materials quantity variance.
B)the materials price variance.
C)the labor rate variance.
D)the labor efficiency variance.

Question 6

Which of the following would produce a labor rate variance?

A)Poor quality materials causing breakage and work interruptions.
B)Use of persons with high hourly wage rates in tasks that call for low hourly wage rates.
C)Excessive number of hours worked in completing a job.
D)An unfavorable variable overhead rate variance.

Question 7

During a recent lengthy strike at Morell Manufacturing Company,management replaced striking assembly line workers with office workers.The assembly line workers had been paid $18 per hour while the office workers are only paid $10 per hour.What is the most likely effect on the labor variances in the first month of this strike?

A)Option A
B)Option B
C)Option C
D)Option D

Question 8

A materials price variance is unfavorable if the actual price exceeds the standard price.

Question 9

The standard cost per unit is computed by dividing the standard quantity or hours by the standard price or rate.

Question 10

Purchase of poor quality materials may cause a favorable materials price variance and an unfavorable labor efficiency variance.

Question 11

An unfavorable labor rate variance can occur if workers with high hourly wage rates are assigned to work on products with standards that assume workers have low hourly wage rates.

Question 12

The materials price variance is computed by multiplying the difference between the actual price and the standard price by the actual quantity of materials purchased.

Question 13

Waste on the production line will result in an unfavorable materials quantity variance.

Question 14

A direct materials quantity standard generally includes an allowance for waste.

Question 15

The standard labor rate per hour defines the company's expected direct labor wage rate per hour,including employment taxes and fringe benefits.

Question 16

Variable manufacturing overhead is applied to products on the basis of standard direct labor-hours.If the labor efficiency variance is unfavorable,the variable overhead efficiency variance will be:

A)favorable.
B)unfavorable.
C)either favorable or unfavorable.
D)zero.

Question 17

Poor quality materials could have an unfavorable effect on which of the following variances?

A)Option A
B)Option B
C)Option C
D)Option D

Question 18

A quantity standard indicates how much output should have been produced.

Question 19

In a company's standard costing system direct labor-hours are used as the base for applying variable manufacturing overhead costs.The standard direct labor rate is twice the variable overhead rate.Last period the labor efficiency variance was unfavorable.From this information one can conclude that last period the variable overhead efficiency variance was:

A)unfavorable and half the labor efficiency variance.
B)favorable and half the labor efficiency variance.
C)unfavorable and twice the labor efficiency variance.
D)favorable and twice the labor efficiency variance.

Question 20

The variable overhead efficiency variance measures how efficiently variable manufacturing overhead resources were used.

Question 21

The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: What is the variable overhead efficiency variance for the month?

A)$17,397 U
B)$16,817 U
C)$312 F
D)$17,085 U

Question 22

The standard cost card for one unit of a certain finished product shows the following: If the total standard variable cost for one unit of finished product is $85,then the standard price per pound for direct materials is:

A)$1.74
B)$4.60
C)$5.90
D)$3.00

Question 23

Welcome Corporation produces metal telephone poles.In the most recent month,the company budgeted production of 4,100 poles.Actual production was 4,400 poles.According to standards,each pole requires 7.0 machine-hours.The actual machine-hours for the month were 31,140 machine-hours.The standard variable manufacturing overhead rate is $2.50 per machine-hour.The actual variable manufacturing overhead cost for the month was $83,787.The variable overhead efficiency variance is:

A)$6,787 F
B)$6,787 U
C)$850 F
D)$850 U

Question 24

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the materials price variance for the month?

A)$2,250 F
B)$7,540 U
C)$24,317 U
D)$7,660 U

Question 25

A quantity of a particular raw material was purchased for $43,250.The standard cost of the material was $2.00 per kilogram and there was an unfavorable materials price variance of $3,250.How many kilograms were purchased?

A)20,000
B)21,625
C)23,250
D)24,875

Question 26

The standard cost card for a product indicates that one unit of the product requires 8 kilograms of a raw material at $0.80 per kilogram.The production of the product in April was 870 units,but production had been budgeted for 850 units.During April,8,200 kilograms of the raw material were purchased for $6,888 and 7,150 kilograms of the raw material were used in production.The material variances for April were:

A)Option A
B)Option B
C)Option C
D)Option D

Question 27

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the materials quantity variance for the month?

A)$13,720 U
B)$6,732 F
C)$13,860 U
D)$6,664 F

Question 28

The Hanson Corporation employs a standard costing system.The following data are available for February: The actual direct labor rate for February is:

A)$7.60 per hour
B)$8.40 per hour
C)$8.00 per hour
D)$2.50 per hour

Question 29

The standard cost card of a particular product specifies that it requires 4.5 direct labor-hours at $12.80 per direct labor-hour.During March,2,300 units of the product were produced and direct labor wages of $128,300 were incurred.A total of 11,700 direct labor-hours were worked.The direct labor variances for the month were:

A)Option A
B)Option B
C)Option C
D)Option D

Question 30

The Fischer Corporation uses a standard costing system.The following data have been assembled for December: The standard hours allowed for December's production is:

A)5,400 hours
B)5,600 hours
C)5,800 hours
D)6,000 hours

Question 31

Dreary Credit Agency uses a standard cost system for the processing of its credit applications.The labor standard at Dreary is 10 applications per 8 hour day at a standard cost of $15 per hour. During the last pay period,Dreary's credit agents worked 1,920 hours and processed 2,500 applications.The total labor cost for the agents during this period was $29,184.What was Dreary's labor efficiency variance for this last pay period?

A)$384 Unfavorable
B)$816 Favorable
C)$1,200 Favorable
D)$1,500 Favorable

Question 32

Sholette Manufacturing Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs)at $5.00 per MH.During the month,the actual total variable manufacturing overhead was $22,540 and the actual level of activity for the period was 4,600 MHs.What was the variable overhead rate variance for the month?

A)$92 Favorable
B)$92 Unfavorable
C)$460 Unfavorable
D)$460 Favorable

Question 33

Sperazza Corporation produces large commercial doors for warehouses and other facilities.In the most recent month,the company budgeted production of 4,900 doors.Actual production was 5,300 doors.According to standards,each door requires 6.4 machine-hours.The actual machine-hours for the month were 34,340 machine-hours.The standard supplies cost is $3.10 per machine-hour.The actual supplies cost for the month was $99,331.Supplies cost is an element of variable manufacturing overhead.The variable overhead efficiency variance for supplies cost is:

A)$5,821 F
B)$5,821 U
C)$1,302 U
D)$1,302 F

Question 34

The following labor standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the labor efficiency variance for the month?

A)$19,017 F
B)$19,017 U
C)$16,029 F
D)$16,577 F

Question 35

Machain Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The company's standard variable manufacturing overhead rate is $2.90 per machine-hour.The actual variable manufacturing overhead cost for the month was $15,270.The original budget for the month was based on 5,000 machine-hours.The company actually worked 5,090 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 5,200 machine-hours.What was the variable overhead efficiency variance for the month?

A)$580 Unfavorable
B)$190 Unfavorable
C)$509 Unfavorable
D)$319 Favorable

Question 36

Blue Corporation's standards call for 2,500 direct labor-hours to produce 1,000 units of product.During May 900 units were produced and the company worked 2,400 direct labor-hours.The standard hours allowed for May production would be:

A)2,500 hours
B)2,400 hours
C)2,250 hours
D)1,800 hours

Question 37

The following labor standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: What is the labor rate variance for the month?

A)$1,295 F
B)$2,877 F
C)$4,246 F
D)$4,246 U

Question 38

The standards for direct materials in making a certain product are 20 pounds at $0.75 per pound.During the past period,56,000 units of product were made and the materials quantity variance was $30,000 U.The number of pounds of direct material used during the period amounted to:

A)1,080,000
B)1,160,000
C)1,200,000
D)784,000

Question 39

Krizum Industries makes heavy construction equipment.The standard for a particular crane calls for 24 direct labor-hours at $16 per direct labor-hour.During a recent period 850 cranes were made.The labor rate variance was zero and the labor efficiency variance was $8,800 unfavorable.How many actual direct labor-hours were worked?

A)19,850
B)20,400
C)20,950
D)35,200

Question 40

Merle Corporation applies manufacturing overhead to products on the basis of standard machine-hours.For the most recent month,the company based its budget on 4,000 machine-hours.Budgeted and actual overhead costs for the month appear below: The company actually worked 3,690 machine-hours during the month.The standard hours allowed for the actual output were 3,620 machine-hours for the month.What was the overall variable overhead efficiency variance for the month?

A)$721 Unfavorable
B)$467 Favorable
C)$254 Unfavorable
D)$880 Favorable

Question 41

Imrie Corporation makes a product that uses a material with the quantity standard of 9.5 grams per unit of output and the price standard of $5.00 per gram.In January the company produced 2,900 units using 26,940 grams of the direct material.During the month the company purchased 28,900 grams of the direct material at $4.90 per gram.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for January is:

A)$2,755 U
B)$2,890 F
C)$2,890 U
D)$2,755 F

Question 42

Degregorio Corporation makes a product that uses a material with the following direct material standards: The company produced 5,600 units in November using 21,750 kilos of the material.During the month,the company purchased 24,800 kilos of the direct material at a total cost of $168,640.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for November is:

A)$4,256 F
B)$4,256 U
C)$4,960 F
D)$4,960 U

Question 43

At Cady Corporation,maintenance is a variable overhead cost that is based on machine-hours.The performance report for June showed that actual maintenance costs totaled $9,600 and that the associated rate variance was $400 unfavorable.If 8,000 machine-hours were actually worked during June,the standard maintenance cost per machine-hour was:

A)$1.30 per MH
B)$1.25 per MH
C)$1.20 per MH
D)$1.15 per MH

Question 44

Stench Foods Corporation uses a standard cost system to collect costs related to the production of its garlic flavored yogurt.The garlic (materials)standards for each container of yogurt produced are 0.8 ounces of crushed garlic at a standard cost of $2.30 per ounce. During the month of June,Stench purchased 75,000 ounces of crushed garlic at a total cost of $171,000.Stench used 64,000 of these ounces to produce 71,500 containers of yogurt.
The direct materials purchases variance is computed when the materials are purchased.
What is Stench's materials price variance for June?

A)$1,500 Favorable
B)$15,640 Unfavorable
C)$17,250 Favorable
D)$23,800 Favorable

Question 45

Blaster,Inc. ,manufactures portable radios.Each radio requires 3 units of Part XBEZ52,which has a standard cost of $1.45 per unit.During May,the company purchased 12,000 units of the part for a total of $18,000.Also during May,the company manufactured 3,000 radios,using 10,000 units of part XBEZ52.The direct materials purchases variance is computed when the materials are purchased. During May,the materials quantity variance for part XBEZ52 was:

A)$1,450 U
B)$1,450 F
C)$4,350 F
D)$4,350 U

Question 46

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: The direct materials purchases variance is computed when the materials are purchased. What is the materials price variance for the month?

A)$4,060 U
B)$3,640 F
C)$3,640 U
D)$4,060 F

Question 47

Melrose Corporation makes a product that uses a material with the following standards: The company budgeted for production of 5,800 units in September,but actual production was 5,900 units.The company used 50,210 pounds of direct material to produce this output.The company purchased 55,100 pounds of the direct material at $5.80 per pound. The direct materials purchases variance is computed when the materials are purchased.
The materials price variance for September is:

A)$11,020 F
B)$9,912 U
C)$9,912 F
D)$11,020 U

Question 48

Canevari Corporation makes a product that uses a material with the following standards: The company budgeted for production of 1,300 units in April,but actual production was 1,200 units.The company used 3,750 kilos of direct material to produce this output.The company purchased 4,100 kilos of the direct material at a total cost of $8,610.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for April is:

A)$315 F
B)$300 U
C)$300 F
D)$315 U

Question 49

The following data have been provided by Gerlach Corporation,a company that produces forklift trucks: Supplies cost is an element of variable manufacturing overhead.The variable overhead efficiency variance for supplies cost is:

A)$966 U
B)$5,897 U
C)$5,897 F
D)$966 F

Question 50

Hien,Inc.uses machine-hours as the base to apply its manufacturing overhead.The following information relates to variable manufacturing overhead standards at Hien: Standard rate per machine-hour: $50
Total standard machine-hours allowed for units produced during September: 4,000
Hien's variable overhead rate variance for September was $800 favorable.Its variable overhead efficiency variance was $3,600 unfavorable.How many machine-hours did Hien actually use during September?

A)3,928
B)3,944
C)4,056
D)4,072

Question 51

Suski Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs).The company has provided the following data for the most recent month: What was the variable overhead rate variance for the month?

A)$1,500 Favorable
B)$590 Unfavorable
C)$910 Favorable
D)$1,000 Unfavorable

Question 52

Schley Corporation applies manufacturing overhead to products on the basis of standard machine-hours.Budgeted and actual overhead costs for the most recent month appear below: The original budget was based on 3,200 machine-hours.The company actually worked 3,510 machine-hours during the month and the standard hours allowed for the actual output were 3,660 machine-hours.What was the overall variable overhead efficiency variance for the month?

A)$550 Favorable
B)$1,208 Unfavorable
C)$22 Favorable
D)$1,230 Favorable

Question 53

Stench Foods Corporation uses a standard cost system to collect costs related to the production of its garlic flavored yogurt.The garlic (materials)standards for each container of yogurt produced are 0.8 ounces of crushed garlic at a standard cost of $2.30 per ounce. During the month of June,Stench purchased 75,000 ounces of crushed garlic at a total cost of $171,000.Stench used 64,000 of these ounces to produce 71,500 containers of yogurt.
The direct materials purchases variance is computed when the materials are purchased.
What is Stench's materials quantity variance for June?

A)$1,500 Favorable
B)$15,640 Unfavorable
C)$17,250 Favorable
D)$23,800 Favorable

Question 54

Degregorio Corporation makes a product that uses a material with the following direct material standards: The company produced 5,600 units in November using 21,750 kilos of the material.During the month,the company purchased 24,800 kilos of the direct material at a total cost of $168,640.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for November is:

A)$3,290 F
B)$3,196 F
C)$3,290 U
D)$3,196 U

Question 55

Canevari Corporation makes a product that uses a material with the following standards: The company budgeted for production of 1,300 units in April,but actual production was 1,200 units.The company used 3,750 kilos of direct material to produce this output.The company purchased 4,100 kilos of the direct material at a total cost of $8,610.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for April is:

A)$360 F
B)$410 U
C)$410 F
D)$360 U

Question 56

Imrie Corporation makes a product that uses a material with the quantity standard of 9.5 grams per unit of output and the price standard of $5.00 per gram.In January the company produced 2,900 units using 26,940 grams of the direct material.During the month the company purchased 28,900 grams of the direct material at $4.90 per gram.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for January is:

A)$2,989 F
B)$3,050 F
C)$2,989 U
D)$3,050 U

Question 57

Melrose Corporation makes a product that uses a material with the following standards: The company budgeted for production of 5,800 units in September,but actual production was 5,900 units.The company used 50,210 pounds of direct material to produce this output.The company purchased 55,100 pounds of the direct material at $5.80 per pound. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for September is:

A)$3,770 F
B)$3,900 U
C)$3,770 U
D)$3,900 F

Question 58

Blaster,Inc. ,manufactures portable radios.Each radio requires 3 units of Part XBEZ52,which has a standard cost of $1.45 per unit.During May,the company purchased 12,000 units of the part for a total of $18,000.Also during May,the company manufactured 3,000 radios,using 10,000 units of part XBEZ52.The direct materials purchases variance is computed when the materials are purchased. During May,the materials price variance for part XBEZ52 was:

A)$450 U
B)$450 F
C)$600 F
D)$600 U

Question 59

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: The direct materials purchases variance is computed when the materials are purchased. What is the materials quantity variance for the month?

A)$1,260 U
B)$1,309 U
C)$11,220 U
D)$10,800 U

Question 60

The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: What is the variable overhead rate variance for the month?

A)$112 F
B)$130 U
C)$4,450 U
D)$4,338 U

Question 61

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost.Jackson has established the following standards for one unit of product. During May,Jackson purchased 125,000 pounds of direct material at a total cost of $475,000.The total factory wages for May were $364,000,90 percent of which were for direct labor.Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours. The price variance for the direct material acquired by Jackson Industries during May is:

A)$21,600 Favorable
B)$25,000 Unfavorable
C)$28,000 Favorable
D)$21,600 Unfavorable

Question 62

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost.Jackson has established the following standards for one unit of product. During May,Jackson purchased 125,000 pounds of direct material at a total cost of $475,000.The total factory wages for May were $364,000,90 percent of which were for direct labor.Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours. The labor efficiency variance for May is:

A)$5,850 Favorable
B)$7,200 Favorable
C)$6,000 Unfavorable
D)$5,850 Unfavorable

Question 63

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for April is:

A)$17,180 U
B)$16,192 F
C)$16,192 U
D)$17,180 F

Question 64

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for April is:

A)$1,232 F
B)$1,360 F
C)$1,360 U
D)$1,232 U

Question 65

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for April is:

A)$8,430 U
B)$8,430 F
C)$7,868 U
D)$7,868 F

Question 66

Longview Hospital performs blood tests in its laboratory.The following standards have been set for each blood test performed: During May,the laboratory performed 1,500 blood tests.On May 1 there were no direct materials (plates)on hand;after a plate is used for a blood test it is discarded.Variable overhead is assigned to blood tests on the basis of standard direct labor-hours.The following events occurred during May: • 3,600 plates were purchased for $9,540
• 3,200 plates were used for blood tests
• 340 actual direct labor-hours were worked at a cost of $5,550
The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for May is:

A)$1,650 F
B)$1,650 U
C)$550 U
D)$720 F

Question 67

The Collins Corporation uses standard costing and has established the following direct material and direct labor standards for each unit of the single product it makes: • Direct materials: 4 gallons at $8 per gallon
• Direct labor: 1 hour at $16 per hour
During July,the company made 6,000 units of product and incurred the following costs:
• Direct materials purchased: 26,800 gallons at $8.20 per gallon
• Direct materials used: 25,200 gallons
• Direct labor used: 5,600 hours at $15.30 per hour
The direct materials purchases variance is computed when the materials are purchased.
The labor efficiency variance for July was:

A)$6,400 Favorable
B)$89,600 Favorable
C)$10,320 Favorable
D)$6,120 Favorable

Question 68

Longview Hospital performs blood tests in its laboratory.The following standards have been set for each blood test performed: During May,the laboratory performed 1,500 blood tests.On May 1 there were no direct materials (plates)on hand;after a plate is used for a blood test it is discarded.Variable overhead is assigned to blood tests on the basis of standard direct labor-hours.The following events occurred during May: • 3,600 plates were purchased for $9,540
• 3,200 plates were used for blood tests
• 340 actual direct labor-hours were worked at a cost of $5,550
The direct materials purchases variance is computed when the materials are purchased.
The variable overhead efficiency variance for May is

A)$350 F
B)$350 U
C)$280 U
D)$280 F

Question 69

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost.Jackson has established the following standards for one unit of product. During May,Jackson purchased 125,000 pounds of direct material at a total cost of $475,000.The total factory wages for May were $364,000,90 percent of which were for direct labor.Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours. The materials quantity variance for May is:

A)$7,200 Unfavorable
B)$7,600 Favorable
C)$5,850 Unfavorable
D)$7,200 Favorable

Question 70

The Collins Corporation uses standard costing and has established the following direct material and direct labor standards for each unit of the single product it makes: • Direct materials: 4 gallons at $8 per gallon
• Direct labor: 1 hour at $16 per hour
During July,the company made 6,000 units of product and incurred the following costs:
• Direct materials purchased: 26,800 gallons at $8.20 per gallon
• Direct materials used: 25,200 gallons
• Direct labor used: 5,600 hours at $15.30 per hour
The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for July was:

A)$3,920 Unfavorable
B)$6,120 Unfavorable
C)$1,120 Favorable
D)$3,920 Favorable

Question 71

Longview Hospital performs blood tests in its laboratory.The following standards have been set for each blood test performed: During May,the laboratory performed 1,500 blood tests.On May 1 there were no direct materials (plates)on hand;after a plate is used for a blood test it is discarded.Variable overhead is assigned to blood tests on the basis of standard direct labor-hours.The following events occurred during May: • 3,600 plates were purchased for $9,540
• 3,200 plates were used for blood tests
• 340 actual direct labor-hours were worked at a cost of $5,550
The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for May is:

A)$225 F
B)$225 U
C)$450 F
D)$450 U

Question 72

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The labor rate variance for April is:

A)$4,224 F
B)$4,224 U
C)$4,096 U
D)$4,096 F

Question 73

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The variable overhead efficiency variance for April is:

A)$240 F
B)$216 U
C)$216 F
D)$240 U

Question 74

The Collins Corporation uses standard costing and has established the following direct material and direct labor standards for each unit of the single product it makes: • Direct materials: 4 gallons at $8 per gallon
• Direct labor: 1 hour at $16 per hour
During July,the company made 6,000 units of product and incurred the following costs:
• Direct materials purchased: 26,800 gallons at $8.20 per gallon
• Direct materials used: 25,200 gallons
• Direct labor used: 5,600 hours at $15.30 per hour
The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for July was:

A)$22,960 Unfavorable
B)$22,400 Unfavorable
C)$9,600 Unfavorable
D)$9,840 Unfavorable

Question 75

Longview Hospital performs blood tests in its laboratory.The following standards have been set for each blood test performed: During May,the laboratory performed 1,500 blood tests.On May 1 there were no direct materials (plates)on hand;after a plate is used for a blood test it is discarded.Variable overhead is assigned to blood tests on the basis of standard direct labor-hours.The following events occurred during May: • 3,600 plates were purchased for $9,540
• 3,200 plates were used for blood tests
• 340 actual direct labor-hours were worked at a cost of $5,550
The direct materials purchases variance is computed when the materials are purchased.
The labor efficiency variance for May is:

A)$600 F
B)$600 U
C)$515 U
D)$515 F

Question 76

Longview Hospital performs blood tests in its laboratory.The following standards have been set for each blood test performed: During May,the laboratory performed 1,500 blood tests.On May 1 there were no direct materials (plates)on hand;after a plate is used for a blood test it is discarded.Variable overhead is assigned to blood tests on the basis of standard direct labor-hours.The following events occurred during May: • 3,600 plates were purchased for $9,540
• 3,200 plates were used for blood tests
• 340 actual direct labor-hours were worked at a cost of $5,550
The direct materials purchases variance is computed when the materials are purchased.
The materials price variance for May is:

A)$360 F
B)$360 U
C)$740 F
D)$740 U

Question 77

Berends Corporation makes a product with the following standard costs: The company reported the following results concerning this product in April. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for April is:

A)$792 F
B)$792 U
C)$768 F
D)$768 U

Question 78

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost.Jackson has established the following standards for one unit of product. During May,Jackson purchased 125,000 pounds of direct material at a total cost of $475,000.The total factory wages for May were $364,000,90 percent of which were for direct labor.Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours. The labor rate variance for May is:

A)$8,400 Favorable
B)$7,200 Unfavorable
C)$8,400 Unfavorable
D)$6,000 Favorable

Question 79

Ortman Corporation makes a product with the following standard costs: The company reported the following results concerning this product in May. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for May is:

A)$1,200 U
B)$1,200 F
C)$1,215 F
D)$1,215 U

Question 80

The Collins Corporation uses standard costing and has established the following direct material and direct labor standards for each unit of the single product it makes: • Direct materials: 4 gallons at $8 per gallon
• Direct labor: 1 hour at $16 per hour
During July,the company made 6,000 units of product and incurred the following costs:
• Direct materials purchased: 26,800 gallons at $8.20 per gallon
• Direct materials used: 25,200 gallons
• Direct labor used: 5,600 hours at $15.30 per hour
The direct materials purchases variance is computed when the materials are purchased.
The materials price variance for July was:

A)$5,360 Favorable
B)$5,360 Unfavorable
C)$5,040 Favorable
D)$5,040 Unfavorable