Question 1

Crawford Corporation has the following information:

Accepted Answer

The answer of Crawford Corporation has the following information:
 ...

Question 2

The actual quantity of input at the actual price less the actual quantity of input at the standard price is the price variance.

Accepted Answer

A) True 
 B)False

Question 3

Figure 10-9. James Company manufactures t-shirts.During the year,it manufactured 250,000 t-shirts,using 2 hours of direct labor at a rate of $8.50 per hour.The materials and labor standards for manufacturing the t-shirts are:
  It took James 1,400,000 yards at $2.50 per yard to make the 250,000 t-shirts.
Refer to Figure 10-9.What is the entry to record the purchase of materials?

Accepted Answer

A) Materials 3,500,000 Materials Price Variance 750,000
Accounts Payable 4,250,000 
B) Materials 4,200,000 Materials Price Variance 750,000
Accounts Payable 4,950,000 
C) Materials 4,200,000 Materials Price Variance 700,000
Accounts Payable 3,500,000 
D) Materials 3,500,000 Materials Price Variance 700,000
Accounts Payable 4,200,000 
A) Materials 3,500,000 Materials Price Variance 750,000
Accounts Payable 4,250,000 
B) Materials 4,200,000 Materials Price Variance 750,000
Accounts Payable 4,950,000 
C) Materials 4,200,000 Materials Price Variance 700,000
Accounts Payable 3,500,000 
D) Materials 3,500,000 Materials Price Variance 700,000
Accounts Payable 4,200,000

Question 4

Figure 10-9. James Company manufactures t-shirts.During the year,it manufactured 250,000 t-shirts,using 2 hours of direct labor at a rate of $8.50 per hour.The materials and labor standards for manufacturing the t-shirts are:
  It took James 1,400,000 yards at $2.50 per yard to make the 250,000 t-shirts.
Refer to Figure 10-9.What is James' materials price variance assuming that materials purchased equals materials used?

Accepted Answer

A) $750,000 F 
B) $700,000 F 
C) $700,000 U 
D) $750,00 U 
A) $750,000 F 
B) $700,000 F 
C) $700,000 U 
D) $750,00 U

Question 5

The _______________ computes the difference between what was paid to direct laborers and what should have been paid.

Accepted Answer

The answer of The _______________ computes the difference between what...

Question 6

Kaizen costing involves:

Accepted Answer

A) changing the standards frequently. 
B) changing management. 
C) outsourcing processes. 
D) major ad campaigns. 
A) changing the standards frequently. 
B) changing management. 
C) outsourcing processes. 
D) major ad campaigns.

Question 7

Which of the following is not an advantage of standard costing over normal costing and actual costing?

Accepted Answer

A) A greater capacity for control. 
B) Ability to easily distinguish the FIFO and weighted average methods of accounting for beginning inventory costs. 
C) Computing a unit cost for each equivalent unit cost category is not necessary. 
D) Providing for readily available unit cost information. 
E) All of these are advantages of standard costing. 
A) A greater capacity for control. 
B) Ability to easily distinguish the FIFO and weighted average methods of accounting for beginning inventory costs. 
C) Computing a unit cost for each equivalent unit cost category is not necessary. 
D) Providing for readily available unit cost information. 
E) All of these are advantages of standard costing.

Question 8

The actual quantity of input at the standard price less than the standard quantity of input at the standard price equals the usage variance.

Accepted Answer

A) True 
 B)False

Question 9

___________________ can provide an initial guideline for setting standards,but should be used with caution because they can perpetuate existing inefficiencies.

Accepted Answer

Historical

Question 10

Figure 10-5.   Refer to Figure 10-5.What is the materials usage variance?

Accepted Answer

A) $112,500 F 
B) $112,500 U 
C) $45,000 F 
D) $45,000 U 
A) $112,500 F 
B) $112,500 U 
C) $45,000 F 
D) $45,000 U

Question 11

An accountant would refer to a cost sheet to perform which of the following actions?

Accepted Answer

A) Calculate standard cost per unit. 
B) Calculate efficiency variances. 
C) Calculate the total amount of inputs allowed for the actual output. 
D) All of these. 
A) Calculate standard cost per unit. 
B) Calculate efficiency variances. 
C) Calculate the total amount of inputs allowed for the actual output. 
D) All of these.

Question 12

DuRoss Company produces coats.The company uses a standard costing system and has set the following standards for materials and labor:
   During the year DuRoss produced 55,000 coats.Actual fabric purchased was 460,000 yards at $5.75 per yard.There were no beginning or ending inventories of fabric.Actual direct labor was 120,000 hours at $19.25 per hour.

Accepted Answer

The answer of DuRoss Company produces coats.The company uses a...

Question 13

The standard unit cost is developed before the standard costs for direct materials,direct labor,and overhead can be set.

Accepted Answer

A) True 
 B)False

Question 14

The materials price variance is computed using the equation

Accepted Answer

A) (Actual Price ´ Actual Quantity)- (Standard Price ´ Standard Quantity). 
B) (Standard Price ´ Actual Quantity)- (Actual Price ´ Actual Quantity). 
C) (Standard Price ´ Standard Quantity)- (Actual Price ´ Actual Quantity). 
D) (Actual Price ´ Actual Quantity)- (Standard Price ´ Actual Quantity). 
E) none of these. 
A) (Actual Price ´ Actual Quantity)- (Standard Price ´ Standard Quantity). 
B) (Standard Price ´ Actual Quantity)- (Actual Price ´ Actual Quantity). 
C) (Standard Price ´ Standard Quantity)- (Actual Price ´ Actual Quantity). 
D) (Actual Price ´ Actual Quantity)- (Standard Price ´ Actual Quantity). 
E) none of these.

Question 15

Roberts Company uses a standard costing system.The following information pertains to direct materials for the July:   Roberts Company reports its material price variances at the time of purchase.What is the material usage variance for Roberts Company?

Accepted Answer

A) $900 F 
B) $1,950 F 
C) $2,850 F 
D) $900 U 
A) $900 F 
B) $1,950 F 
C) $2,850 F 
D) $900 U

Question 16

The standard cost sheet provides the input standards needed to compute the total amount of inputs allowed for the actual output,an essential component in computing efficiency variances.

Accepted Answer

A) True 
 B)False

Question 17

Standard costs are developed for direct materials,direct labor,and variable overhead only.

Accepted Answer

A) True 
 B)False

Question 18

Engineering studies are often too rigorous and may not be achievable by operating personnel.

Accepted Answer

A) True 
 B)False

Question 19

Acme Brick Company uses the following rule to determine whether materials usage variances should be investigated:
A materials usage variance will be investigated when the variance is greater than either $5,000 or 10 percent of the standard cost.
During June,the company purchased and used 9,500 pounds of concrete for $5 per pound.It was able to make 20,000 bricks.Its standard quantity of materials allowed is 0.45 pound of concrete per brick at a standard price of $6 per pound.

Accepted Answer

The answer of Acme Brick Company uses the following rule...

Question 20

Figure 10-7. During April,a small roofing company purchased 700 bundles of a certain type of shingle at a price of $35 per bundle,$8 more than the standard price.Its standard quantity of this type of shingle is 725 bundles.
Refer to Figure 10-7.What is the journal entry to record the purchase of materials?

Accepted Answer

A) Materials 19,575 Materials Price Variance 5,800
Accounts Payable 25,375 
B) Materials 24,500 Materials Price Variance 5,600
Accounts Payable 18,900 
C) Materials 18,900 Materials Price Variance 5,600
Accounts Payable 24,500 
D) Materials 25,375 Materials Price Variance 5,800
Accounts Payable 19,575 
A) Materials 19,575 Materials Price Variance 5,800
Accounts Payable 25,375 
B) Materials 24,500 Materials Price Variance 5,600
Accounts Payable 18,900 
C) Materials 18,900 Materials Price Variance 5,600
Accounts Payable 24,500 
D) Materials 25,375 Materials Price Variance 5,800
Accounts Payable 19,575

Crawford Corporation has the following information:

The actual quantity of input at the actual price less the actual quantity of input at the standard price is the price variance.

The _______________ computes the difference between what was paid to direct laborers and what should have been paid.

Kaizen costing involves:

Which of the following is not an advantage of standard costing over normal costing and actual costing?

The actual quantity of input at the standard price less than the standard quantity of input at the standard price equals the usage variance.

___________________ can provide an initial guideline for setting standards,but should be used with caution because they can perpetuate existing inefficiencies.

Figure 10-5. Refer to Figure 10-5.What is the materials usage variance?

An accountant would refer to a cost sheet to perform which of the following actions?

The standard unit cost is developed before the standard costs for direct materials,direct labor,and overhead can be set.

The materials price variance is computed using the equation

Roberts Company uses a standard costing system.The following information pertains to direct materials for the July: Roberts Company reports its material price variances at the time of purchase.What is the material usage variance for Roberts Company?

The standard cost sheet provides the input standards needed to compute the total amount of inputs allowed for the actual output,an essential component in computing efficiency variances.

Standard costs are developed for direct materials,direct labor,and variable overhead only.

Engineering studies are often too rigorous and may not be achievable by operating personnel.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 10: Standard Costing: a Managerial Control Tool

Crawford Corporation has the following information:

The actual quantity of input at the actual price less the actual quantity of input at the standard price is the price variance.

The _______________ computes the difference between what was paid to direct laborers and what should have been paid.

Kaizen costing involves:

Which of the following is not an advantage of standard costing over normal costing and actual costing?

The actual quantity of input at the standard price less than the standard quantity of input at the standard price equals the usage variance.

___________________ can provide an initial guideline for setting standards,but should be used with caution because they can perpetuate existing inefficiencies.

Figure 10-5. Refer to Figure 10-5.What is the materials usage variance?

An accountant would refer to a cost sheet to perform which of the following actions?

The standard unit cost is developed before the standard costs for direct materials,direct labor,and overhead can be set.

The materials price variance is computed using the equation

Roberts Company uses a standard costing system.The following information pertains to direct materials for the July: Roberts Company reports its material price variances at the time of purchase.What is the material usage variance for Roberts Company?

The standard cost sheet provides the input standards needed to compute the total amount of inputs allowed for the actual output,an essential component in computing efficiency variances.

Standard costs are developed for direct materials,direct labor,and variable overhead only.

Engineering studies are often too rigorous and may not be achievable by operating personnel.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters