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

Question 1

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

A)Standard output at standard hours.
B)Actual output at standard hours.
C)Standard output at actual hours.
D)Actual output at actual hours.

Answer 1

B

Question 2

Information relating to direct labor for Brussels,Inc.follow: The labor efficiency variance is:

A)$4,100 unfavorable
B)$5,300 unfavorable
C)$4,050 unfavorable
D)$1,100 unfavorable

Answer 2

D

Question 3

Characteristics of ideal standards include all of the following except:

A)They generally give rise to unfavorable variances.
B)They may cause personnel to become discouraged.
C)They take into account normal waste and spoilage.
D)They provide a maximum objective for which to strive to improve efficiency.

Answer 3

C

Question 4

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

A)Impact of negotiations with labor unions.
B)The learning effect.
C)Results of engineers' time studies.
D)Trend of prices of raw materials.

Question 5

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?

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

Question 6

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

A)Combined price--quantity variance.
B)Price variance.
C)Volume variance.
D)Mix variance.

Question 7

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 8,300 square feet of vinyl at a cost of $.80 per square foot,a total cost of $7,055.If the materials price variance was recorded when the material was issued to production,that variance was:

A)$290 favorable.
B)$830 unfavorable.
C)$290 unfavorable.
D)$830 favorable.

Question 8

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

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

Question 9

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

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

Question 10

The materials quantity variance,in a standard cost system,is the:

A)Difference between the actual and standard quantities.
B)Difference between the actual and standard quantities multiplied by the actual unit price.
C)Difference between the actual quantity used and the actual quantity purchased multiplied by the standard unit price.
D)Difference between the actual and standard quantities multiplied by the standard unit price.

Question 11

A manufacturer generally wants to set a standard that:

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 12

The purpose of standard costing is to:

A)Determine optimal production level for a given period.
B)Eliminate the need for subjective decisions by management.
C)Control costs and promote efficiency.
D)Budget costs with improved accuracy.

Question 13

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

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

Question 14

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?

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

Question 15

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?

A)$180 unfavorable
B)$165 unfavorable
C)$180 favorable
D)$165 favorable

Question 16

An unfavorable labor efficiency variance is the:

A)Number of actual hours worked in excess of the standard hours allowed multiplied by the standard labor rate.
B)Number of actual hours worked in excess of the standard hours allowed multiplied by the actual labor rate.
C)The number of actual hours worked below the standard hours allowed multiplied by the standard labor rate.
D)Number of actual hours multiplied by the difference in the actual and standard labor rates.

Question 17

Information relating to direct labor for the Newstead Company follow: The labor rate variance is:

A)$2,800 unfavorable
B)$2,700 unfavorable
C)$4,600 unfavorable
D)$1,800 unfavorable

Question 18

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

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

Question 19

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?

A)Management by exception
B)Contribution approach
C)Marginal costing
D)Standardized accounting system

Question 20

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:

A)$255 favorable.
B)$255 unfavorable.
C)$360 unfavorable.
D)$360 favorable.

Question 21

Andrews Corporation purchased 3,000 gallons of raw materials for $9,200.The standard price is $3.00 per gallon.If Andrews records the price variance at the earliest possible time,the entry to record the purchase of the material is:

A)Materials 9,200 Material purchase price variance 200 Accounts payable 9,000
B)Materials 9,000 Accounts payable 9,000
C)Materials 9,000 Material purchase price variance 200
Accounts payable 9,200
D)Materials 9,200 Accounts payable 9,200

Question 22

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

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

Question 23

Standard costing will produce the same income before extraordinary items as actual costing when standard cost variances are assigned to:

A)Work in process and finished goods inventories.
B)An income or expense account.
C)Cost of goods sold and inventories.
D)Cost of goods sold.

Question 24

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?

A)There is no need to further evaluate the total materials variance if it is favorable.
B)Generally accepted accounting principles require that all variances be analyzed in three stages.
C)All variances must appear in the annual report to equity owners for proper disclosure.
D)It is done so that management can evaluate the efficiency of the purchasing and production functions.

Question 25

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

A)Taking appropriate action to follow up on variances.
B)Breaking down the total variance by usage and price.
C)Adding variances together to determine the impact on financial statements.
D)Analyzing cause and effect of both favorable and unfavorable variances.

Question 26

James Corporation uses a standard cost system and recognizes the materials purchase price variance at the time materials are purchased.Information for raw materials for the month of December follows: What is the entry to record material usage?

A)Work in process 6,270 Materials quantity variance 330
Materials 6,600
B)Work in process 6,270 Materials quantity variance 330
Materials 5,940
C)Work in process 6,300 Materials quantity variance 350
Materials 6,650
D)Work in process 5,940 Materials quantity variance 330
Materials 6,270

Question 27

What is the normal year-end treatment of immaterial variances recognized in a cost accounting system utilizing standards?

A)Reclassified to deferred charges until all related production is sold
B)Closed to cost of goods sold in the period in which they arose
C)Allocated among cost of goods manufactured and ending work in process inventory
D)Capitalized as a cost of ending finished goods inventory

Question 28

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?

A)1,330
B)1,400
C)1,500
D)1,300

Question 29

PHI Company began its operations on January 1 and produces a single product that sells for $35.00 per unit.5,000 units were produced and 4,000 units were sold during the year. Standard costs per unit follow: What is entry to record the finished goods?

A)Finished goods 115,000 Work in process 115,000
B)Finished goods 92,000 Work in process 92,000
C)Work in process 115,000 Finished goods 115,000
D)Cost of goods sold 92,000 Finished goods 92,000

Question 30

The direct labor costs for Boundary Company follow: What was Boundary's standard direct labor rate?

A)$ 11.95
B)$ 11.49
C)$ 11.60
D)$ 12.00

Question 31

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

A)Reported as a deferred charge or credit
B)Allocated among work in process inventory,finished goods inventory,and cost of goods sold
C)Charged or credited to cost of goods manufactured
D)Allocated among cost of goods manufactured,finished goods inventory,and cost of goods sold

Question 32

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 entry to record the purchase of materials?

A)Materials 6,600 Material purchase price variance 400
Accounts payable 7,000
B)Materials 7,000 Material purchase price variance 400
Accounts payable 6,600
C)Materials 6,600 Accounts payable 6,600
D)Materials 6,600 Material purchase price variance 330
Accounts payable 6,270

Question 33

The following information pertains to Genie Company: What is the entry to record the direct materials cost and variances,assuming that the price variance is recorded when the materials are put into production?

A)Materials 12,000 Materials price variance 2,000
Accounts payable 13,000
​
B)Work in process 12,000 Materials quantity variance 1,000
Materials price variance 2,000
Materials 11,000
​
C)Work in process 11,000 Materials price variance 2,000
Materials 13,000
​
D)Work in process 12,000 Materials price variance 2,000
Materials quantity variance 1,000
Materials 13,000

Question 34

Taking appropriate action on variances includes all of the following except:

A)Ignoring the cause of favorable variances.
B)Revising the standard because it was set incorrectly.
C)Improving the manufacturing process.
D)Looking for new suppliers.

Question 35

If a company follows a practice of isolating variances at the earliest point in time,what would be the appropriate time to isolate and recognize a direct material price variance?

A)When material is purchased
B)When material is used in production
C)When purchase order is originated
D)When material is issued

Question 36

In a standard cost system,when the materials price variance is recorded at the time the material is purchased,the materials purchase price variance is obtained by multiplying the:

A)Actual price by the difference between actual quantity purchased and standard quantity used.
B)Actual quantity purchased by the difference between actual price and standard price.
C)Standard price by the difference between standard quantity purchased and standard quantity used.
D)Standard quantity purchased by the difference between actual price and standard price.

Question 37

The following information pertains to William Company: What is the entry to record the direct labor cost and variances?

A)Payroll 30,000 Labor rate variance 500
Labor efficiency variance 2,500
Accrued payroll 33,000
B)Work in process 27,000 Labor rate variance 500
Labor efficiency variance 2,500
Payroll 30,000
C)Work in process 30,000 Payroll 30,000
D)Work in process 27,000 Labor variances 3,000
Payroll 30,000

Question 38

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?

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

Question 39

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

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 40

Information relating to direct labor for the McGill Company follow: The entry to record the direct labor cost is:

A)Work in process 53,200 Labor rate variance 2,800
Labor efficiency variance 1,800
Payroll 48,600
B)Work in process 50,400 Labor rate variance 2,800
Payroll 53,200
C)Work in process 48,600 Labor rate variance 2,800
Labor efficiency variance 1,800
Payroll 53,200
D)Work in process 51,400 Labor efficiency variance 1,800
Payroll 53,200

Question 41

A company uses a two-variance analysis for overhead variances,flexible-budget and production-volume.The production-volume variance is the difference between the factory overhead applied at standard and:

A)Total factory overhead per the flexible budget.
B)Actual factory overhead incurred.
C)Total factory overhead per the master budget.
D)Fixed overhead incurred.

Question 42

Information on Shonda Company's factory overhead costs follows: What is the net factory overhead variance?

A)$4,500 unfavorable
B)$4,500 favorable
C)$2,500 unfavorable
D)$2,500 favorable

Question 43

Under normal circumstances,a purchasing manager who buys poor quality materials because they were cheaper could potentially be responsible for causing all of the following variances except a(n):

A)Favorable purchase price variance.
B)Unfavorable materials quantity variance.
C)Unfavorable purchase price variance.
D)Unfavorable labor efficiency variance.

Question 44

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

A)The company paid the workers overtime.
B)The company hired more experienced workers.
C)The company purchased materials that were hard to work with.
D)The workers "goofed around" and wasted time.

Question 45

Which of the following is not likely to cause a labor efficiency variance?

A)We produced more units than were budgeted.
B)There was a flu outbreak and workers had to cover unfamiliar positions.
C)We purchased materials that were poor in quality.
D)One of the supervisors discovered a way to streamline a process.

Question 46

Bobby's Burger Place monitors its variances on an hourly basis.It is not uncommon for Bobby to send workers home early when which of the following variances indicates that he has over-scheduled the shift?

A)Unfavorable labor efficiency variance.
B)Favorable labor rate variance.
C)Unfavorable materials quantity variance.
D)Favorable labor efficiency variance.

Question 47

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 flexible-budget variance for April?

A)$1,100 favorable
B)$1,100 unfavorable
C)$575 favorable
D)$575 unfavorable

Question 48

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:

A)$5,000 favorable.
B)$5,000 unfavorable.
C)$2,000 favorable.
D)$2,000 unfavorable.

Question 49

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

A)The effect of differences in the actual variable factory overhead rate and the standard variable factory overhead rate.
B)The difference in the actual hours incurred and standard hours allowed for a given level of production.
C)The difference between actual and applied variable factory overhead.
D)The difference between actual variable factory overhead and budgeted variable factory overhead.

Question 50

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?

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

Question 51

The Davis Corporation budgeted factory overhead at $250,000 for the period for the Assembly Department based on a budgeted volume of 100,000 direct labor hours.At the end of the period,the factory overhead control account for the Assembly Department had a balance of $252,000.The actual (and allowed)direct labor hours were 103,000. ​
What was the over- or underapplied factory overhead for the period?

A)$3,000 underapplied
B)$3,000 overapplied
C)$5,500 underapplied
D)$5,500 overapplied

Question 52

Elgin Company's budgeted fixed factory overhead costs are $50,000 per month plus a variable factory overhead rate of $4.00 per direct labor hour.The standard direct labor hours allowed for October production were 20,000.An analysis of the factory overhead indicates that in October,Elgin had an unfavorable flexible-budget variance of $1,500 and a favorable production-volume variance of $500.Elgin uses a two-variance analysis of overhead variances. The applied factory overhead in October is:

A)$129,500.
B)$128,000.
C)$130,000.
D)$130,500.

Question 53

The fixed overhead application rate is a function of a predetermined "normal" activity level.If standard hours allowed for good output equal this "normal" activity level for a given period,the production-volume variance will be:

A)Zero.
B)Favorable.
C)Unfavorable.
D)Either favorable or unfavorable depending on the budgeted overhead.

Question 54

All of the following are features of a standard cost system except:

A)Standards should not be adjusted.
B)Standards provide incentives for workers to keep costs in line.
C)Comparisons between actual and standard are more effective than comparisons between actual costs of the current period and those of the prior period.
D)A standard cost system focuses management attention on materials prices and usages.

Question 55

All of the following are features of a standard cost system except:

A)Standards change as conditions change.
B)Variances may be determined more often than monthly to allow for more timely action.
C)Standards are based on estimates.
D)The company determines the actual cost of manufacturing a unit.

Question 56

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:

A)$1,500favorable.
B)$1,500 unfavorable.
C)$2,000 favorable.
D)$2,000 unfavorable.

Question 57

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:

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

Question 58

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:

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 59

In a two-variance system for analyzing factory overhead,a favorable production-volume variance could be caused by:

A)The top salesman leaving the company.
B)Receiving more orders than anticipated.
C)Receiving less orders than anticipated.
D)A work slow-down by workers.

Question 60

Underapplied factory overhead would result if:

A)Factory overhead costs incurred were greater than standard costs charged to production.
B)The plant was operated at less than normal capacity.
C)Factory overhead costs incurred were less than standard costs charged to production.
D)Factory overhead costs incurred were unreasonably large in relation to units produced.

Question 61

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:

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

Question 62

Which of the following correctly demonstrates the comparison of the four-variance method of factory overhead analysis to the two-variance method of factory overhead analysis?

A)The sum of the fixed and variable spending variances in the four-variance method is equal to the flexible-budget variance in the two-variance method.
B)The sum of the fixed and variable spending and variable efficiency variances in the four-variance method is equal to the flexible-budget variance in the two-variance method.
C)The sum of the fixed and variable spending,variable efficiency and production-volume variances in the four-variance method is equal to the flexible-budget variance in the two-variance method.
D)The fixed spending variance in the four-variance method is equal to the flexible-budget variance in the two-variance method.

Question 63

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

Question 64

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 production-volume variance?

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

Question 65

The normal capacity of the Malloy Company is 20,000 direct labor hours and 10,000 units per month.A finished unit requires 15 pounds of materials at an estimated cost of $1.00 per pound.The estimated cost of labor is $12.00 per hour.It is estimated that overhead for a month will be $15,000.
During the month of June,19,000 direct labor hours were worked at an average rate of $11.50 an hour.The number of units produced was 9,000,using all 132,000 pounds of material that were purchased at a cost of $1.05 per pound.
a.Prepare a standard cost summary showing the standard unit cost.
b.Calculate the material and labor variances.
c.Prepare entries in general journal form to charge materials and labor to work in process.Indicate whether the variances are favorable or unfavorable.

Question 66

In a four-variance method analyzing factory overhead,the fixed factory overhead production-volume variance measures:

A)The difference between the actual fixed factory overhead and budgeted fixed factory overhead.
B)The difference between actual fixed factory overhead and the amount of fixed factory overhead applied to production.
C)The difference between budgeted fixed factory overhead and the amount of fixed factory overhead applied to production.
D)The difference between the actual hours and standard hours allowed multiplied by the standard fixed factory overhead rate.

Question 67

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

A)$800 favorable
B)$800 unfavorable
C)$500 favorable
D)$500 unfavorable

Question 68

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

A)The difference between the actual fixed factory overhead and budgeted fixed factory overhead.
B)The difference between actual fixed factory overhead and the amount of fixed factory overhead applied to production.
C)The difference between budgeted fixed factory overhead and the amount of fixed factory overhead applied to production.
D)The difference between the actual hours and standard hours allowed multiplied by the standard fixed factory overhead rate.

Question 69

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:

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

Question 70

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

Question 71

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?

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

Question 72

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

A)$800 favorable
B)$800 unfavorable
C)$500 favorable
D)$500 unfavorable

Question 73

Which of the following correctly demonstrates the comparison of the four-variance method of factory overhead analysis to the two-variance method of factory overhead analysis?

A)The sum of the fixed and variable spending and variable efficiency variances in the four-variance method is equal to the production-volume variance in the two-variance method.
B)The sum of the fixed production-volume and variable efficiency variances in the four-variance method is equal to the production-volume variance in the two-variance method.
C)The fixed production-volume variance in the four-variance method is equal to the production-volume variance in the two-variance method.
D)The sum of the fixed spending and fixed production-volume variances in the four-variance method is equal to the production-volume variance in the two-variance method.

Question 74

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.

Question 75

Hernandez Corporation uses a standard cost system and has established the following standards for one unit of product: During October,the company purchased 240,000 pounds of material at a total cost of $588,000.The total factory wages for October were $49,400.During October,21,000 units of product were manufactured using 211,000 pounds of material and 5,200 direct labor hours.Material quantity and price variances are recorded when materials are used.
a.Compute the material quantity and labor efficiency variances.
b.Compute the material price and labor rate variances.Show whether each of the above variances was either favorable or unfavorable.

Question 76

Fill in the missing figures below:

Question 77

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 spending variance?

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

Question 78

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?

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

Question 79

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

A)The effect of differences in the actual variable factory overhead and the standard variable factory overhead rate multiplied by the actual hours.
B)The difference in the actual hours incurred and standard hours allowed for a given level of production.
C)The difference between actual and applied variable factory overhead.
D)The difference between actual variable factory overhead and budgeted variable factory overhead.

Question 80

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?

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