Question 1

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Accepted Answer

A) True 
 B)False

Question 2

Information on Jayhawk's direct labor costs for the month of August is as follows: $$\begin{array} { l r } 
\text { Actual rate } & \$ 10 \
\text { Standard hours } & 11,000 \
\text { Actual hours } & 10,000 \
\text { Direct labor price variance-unfavorable } & \$ 4,000
\end{array}$$ What was the standard rate for August?

Accepted Answer

A) $9.96 
B) $9.60 
C) $10.40 
D) $10.04 
A) $9.96 
B) $9.60 
C) $10.40 
D) $10.04

Question 3

A standard cost system may be used with a job order cost system but not with a process cost system.

Accepted Answer

A) True 
 B)False

Question 4

A direct labor price standard is frequently called the direct labor efficiency standard.

Accepted Answer

A) True 
 B)False

Question 5

The two levels that standards may be set at are

Accepted Answer

A) normal and fully efficient. 
B) normal and ideal. 
C) ideal and less efficient. 
D) fully efficient and fully effective. 
A) normal and fully efficient. 
B) normal and ideal. 
C) ideal and less efficient. 
D) fully efficient and fully effective.

Question 6

The overhead volume variance relates only to

Accepted Answer

A) variable overhead costs. 
B) fixed overhead costs. 
C) both variable and fixed overhead costs. 
D) all manufacturing costs. 
A) variable overhead costs. 
B) fixed overhead costs. 
C) both variable and fixed overhead costs. 
D) all manufacturing costs.

Question 7

The perspectives included in the balanced scorecard approach include all of the following except the

Accepted Answer

A) internal process perspective. 
B) capacity utilization perspective. 
C) learning and growth perspective. 
D) customer perspective. 
A) internal process perspective. 
B) capacity utilization perspective. 
C) learning and growth perspective. 
D) customer perspective.

Question 8

The direct materials quantity standard would not be expressed in

Accepted Answer

A) pounds. 
B) barrels. 
C) dollars. 
D) board feet. 
A) pounds. 
B) barrels. 
C) dollars. 
D) board feet.

Question 9

Dillon has a standard of 2 hours of labor per unit, at $12 per hour.In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970.Dillon's total labor variance is

Accepted Answer

A) $1,030 U. 
B) $800 U. 
C) $1,030 F. 
D) $1,930 F. 
A) $1,030 U. 
B) $800 U. 
C) $1,030 F. 
D) $1,930 F.

Question 10

Which of the following is not considered an advantage of using standard costs?

Accepted Answer

A) Standard costs can reduce clerical costs. 
B) Standard costs can be useful in setting prices for finished goods. 
C) Standard costs can be used as a means of finding fault with performance. 
D) Standard costs can make employees "cost-conscious." 
A) Standard costs can reduce clerical costs. 
B) Standard costs can be useful in setting prices for finished goods. 
C) Standard costs can be used as a means of finding fault with performance. 
D) Standard costs can make employees "cost-conscious."

Question 11

If actual direct materials costs are greater than standard direct materials costs, it means that

Accepted Answer

A) actual costs were calculated incorrectly. 
B) the actual unit price of direct materials was greater than the standard unit price of direct materials. 
C) the actual unit price of raw materials or the actual quantities of raw materials used was greater than the standard unit price or standard quantities of raw materials expected. 
D) the purchasing agent or the production foreman is inefficient. 
A) actual costs were calculated incorrectly. 
B) the actual unit price of direct materials was greater than the standard unit price of direct materials. 
C) the actual unit price of raw materials or the actual quantities of raw materials used was greater than the standard unit price or standard quantities of raw materials expected. 
D) the purchasing agent or the production foreman is inefficient.

Question 12

Use the following information for questions 
Oxnard Industries produces a product that requires 2.6 pounds of materials per unit. The allowance for waste and spoilage per unit is .3 pounds and .1 pounds, respectively. The purchase price is $2 per pound, but a 2% discount is usually taken. Freight costs are $.10 per pound, and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00 per hour, but a raise which will average $.30 will go into effect soon. Payroll taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard production time is 1 hour per unit, and the allowance for rest periods and setup is .2 hours and .1 hours, respectively.
-The standard direct labor hours per unit is

Accepted Answer

A) 1 hour. 
B) 1.1 hours. 
C) 1.2 hours. 
D) 1.3 hours. 
A) 1 hour. 
B) 1.1 hours. 
C) 1.2 hours. 
D) 1.3 hours.

Question 13

Standard costs may be incorporated into the accounts in the general ledger.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements about standard costs is false?

Accepted Answer

A) Properly set standards should promote efficiency. 
B) Standard costs facilitate management planning. 
C) Standards should not be used in "management by exception." 
D) Standard costs can simplify the costing of inventories. 
A) Properly set standards should promote efficiency. 
B) Standard costs facilitate management planning. 
C) Standards should not be used in "management by exception." 
D) Standard costs can simplify the costing of inventories.

Question 15

In using variance reports, management looks for

Accepted Answer

A) total assets invested. 
B) significant variances. 
C) competitors' costs in comparison to the company's costs. 
D) more efficient ways of valuing inventories. 
A) total assets invested. 
B) significant variances. 
C) competitors' costs in comparison to the company's costs. 
D) more efficient ways of valuing inventories.

Question 16

Labor efficiency is measured by the

Accepted Answer

A) materials quantity variance. 
B) total labor variance. 
C) labor quantity variance. 
D) labor rate variance. 
A) materials quantity variance. 
B) total labor variance. 
C) labor quantity variance. 
D) labor rate variance.

Question 17

Atkins, Inc.produces a product requiring 8 pounds of material at $1.50 per pound.Atkins produced 10,000 units of this product during 2016 resulting in a $30,000 unfavorable materials quantity variance.How many pounds of direct material did Atkins use during 2016?

Accepted Answer

A) 100,000 pounds 
B) 80,000 pounds 
C) 160,000 pounds 
D) 125,000 pounds 
A) 100,000 pounds 
B) 80,000 pounds 
C) 160,000 pounds 
D) 125,000 pounds

Question 18

The difference between a budget and a standard is that

Accepted Answer

A) a budget expresses what costs were, while a standard expresses what costs should be. 
B) a budget expresses management's plans, while a standard reflects what actually happened. 
C) a budget expresses a total amount, while a standard expresses a unit amount. 
D) standards are excluded from the cost accounting system, whereas budgets are generally incorporated into the cost accounting system. 
A) a budget expresses what costs were, while a standard expresses what costs should be. 
B) a budget expresses management's plans, while a standard reflects what actually happened. 
C) a budget expresses a total amount, while a standard expresses a unit amount. 
D) standards are excluded from the cost accounting system, whereas budgets are generally incorporated into the cost accounting system.

Question 19

Denmark Corporation's variance report for the purchasing department reports 1,000 units of material A purchased and 2,400 units of material B purchased.It also reports standard prices of $2 for Material A and $3 for Material B.Actual prices reported are $2.10 for Material A and $2.80 for Material B.Denmark should report a total price variance of

Accepted Answer

A) $380 F. 
B) $340 F. 
C) $340 U. 
D) $380 U. 
A) $380 F. 
B) $340 F. 
C) $340 U. 
D) $380 U.

Question 20

Which one of the following statements is true?

Accepted Answer

A) If the materials price variance is unfavorable, then the materials quantity variance must also be unfavorable. 
B) If the materials price variance is unfavorable, then the materials quantity variance must be favorable. 
C) Price and quantity variances move in the same direction. If one is favorable, the others will be as well. 
D) There is no correlation of favorable or unfavorable for price and quantity variances. 
A) If the materials price variance is unfavorable, then the materials quantity variance must also be unfavorable. 
B) If the materials price variance is unfavorable, then the materials quantity variance must be favorable. 
C) Price and quantity variances move in the same direction. If one is favorable, the others will be as well. 
D) There is no correlation of favorable or unfavorable for price and quantity variances.

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Information on Jayhawk's direct labor costs for the month of August is as follows: Actual rate \ 10 Standard hours 11,000 Actual hours 10,000 Direct labor price variance-unfavorable \ 4,000 What was the standard rate for August?

A standard cost system may be used with a job order cost system but not with a process cost system.

A direct labor price standard is frequently called the direct labor efficiency standard.

The two levels that standards may be set at are

The overhead volume variance relates only to

The perspectives included in the balanced scorecard approach include all of the following except the

The direct materials quantity standard would not be expressed in

Dillon has a standard of 2 hours of labor per unit, at $12 per hour.In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970.Dillon's total labor variance is

Which of the following is not considered an advantage of using standard costs?

If actual direct materials costs are greater than standard direct materials costs, it means that

Standard costs may be incorporated into the accounts in the general ledger.

Which of the following statements about standard costs is false?

In using variance reports, management looks for

Labor efficiency is measured by the

Atkins, Inc.produces a product requiring 8 pounds of material at $1.50 per pound.Atkins produced 10,000 units of this product during 2016 resulting in a $30,000 unfavorable materials quantity variance.How many pounds of direct material did Atkins use during 2016?

The difference between a budget and a standard is that

Which one of the following statements is true?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Time Value of Money

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Exam 11: Reporting and Analyzing Stockholders Equity

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Information on Jayhawk's direct labor costs for the month of August is as follows: Actual rate \ 10 Standard hours 11,000 Actual hours 10,000 Direct labor price variance-unfavorable \ 4,000 What was the standard rate for August?

A standard cost system may be used with a job order cost system but not with a process cost system.

A direct labor price standard is frequently called the direct labor efficiency standard.

The two levels that standards may be set at are

The overhead volume variance relates only to

The perspectives included in the balanced scorecard approach include all of the following except the

The direct materials quantity standard would not be expressed in

Dillon has a standard of 2 hours of labor per unit, at $12 per hour.In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970.Dillon's total labor variance is

Which of the following is not considered an advantage of using standard costs?

If actual direct materials costs are greater than standard direct materials costs, it means that

Standard costs may be incorporated into the accounts in the general ledger.

Which of the following statements about standard costs is false?

In using variance reports, management looks for

Labor efficiency is measured by the

Atkins, Inc.produces a product requiring 8 pounds of material at $1.50 per pound.Atkins produced 10,000 units of this product during 2016 resulting in a $30,000 unfavorable materials quantity variance.How many pounds of direct material did Atkins use during 2016?

The difference between a budget and a standard is that

Which one of the following statements is true?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Time Value of Money

Filters