Question 1

What type of variance results when the actual fixed overhead costs incurred are greater than the budgeted fixed overhead costs?

Accepted Answer

A) Favorable fixed overhead budget variance 
B) Unfavorable fixed overhead budget variance 
C) Favorable fixed overhead volume variance 
D) Unfavorable fixed overhead volume variance 
A) Favorable fixed overhead budget variance 
B) Unfavorable fixed overhead budget variance 
C) Favorable fixed overhead volume variance 
D) Unfavorable fixed overhead volume variance

Question 2

Sherwin Chemicals produces commercial strength cleansing supplies.Two of its main products are window cleanser that uses ammonia,and floor cleanser that uses bleach.Information for the most recent period follows:
 
What is the direct materials price variance for ammonia?

Accepted Answer

A) $2,500 favorable 
B) $2,500 unfavorable 
C) $375 favorable 
D) $375 unfavorable 
A) $2,500 favorable 
B) $2,500 unfavorable 
C) $375 favorable 
D) $375 unfavorable

Question 3

Dozen Bakery makes cupcakes and cookies.Dozen gathered the following information for the current year regarding its use of flour and butter (flour is a direct material for cupcakes and butter is a direct material for cookies):
 
What is the direct materials flexible budget variance for the flour in cupcakes?

Accepted Answer

A) $200 favorable 
B) $800 unfavorable 
C) $800 favorable 
D) $200 unfavorable 
A) $200 favorable 
B) $800 unfavorable 
C) $800 favorable 
D) $200 unfavorable

Question 4

If the actual number of units produced is less than the number of units budgeted to produced,then the fixed overhead volume variance will always be unfavorable.

Accepted Answer

A) True 
 B)False

Question 5

Dorsey Corporation Company budgeted 600 pounds of direct materials costing $28.00 per pound to make 7,000 units of product.The company actually used 630 pounds of direct materials costing $30.00 per pound to make the 7,000 units.What is the direct materials quantity variance?

Accepted Answer

A) $900 favorable 
B) $840 favorable 
C) $900 unfavorable 
D) $840 unfavorable 
A) $900 favorable 
B) $840 favorable 
C) $900 unfavorable 
D) $840 unfavorable

Question 6

A(n)________ is a carefully predetermined cost that is usually expressed on a per unit basis.

Accepted Answer

A) allocated cost 
B) applied cost 
C) standard cost 
D) flexible cost 
A) allocated cost 
B) applied cost 
C) standard cost 
D) flexible cost

Question 7

Cuyahoga Corporation reports the following standards for direct labor for the year:   
During the year,35,000 finished goods were produced.The direct labor efficiency variance was $2,650 favorable.The direct labor flexible budget variance was $550 favorable.
Calculate the following items regarding direct labor for Cuyahoga Corporation for the year:
A.Direct labor rate variance
B.Standard hours of direct labor for actual production
C.Actual hours of direct labor incurred for actual production

Accepted Answer

The answer of Cuyahoga Corporation reports the following standards for...

Question 8

The cause of a fixed overhead variance,such as an unanticipated increase or decrease in property taxes at the factory,is always under the control of management.

Accepted Answer

A) True 
 B)False

Question 9

Regarding a standard cost income statement,which of the following is true?

Accepted Answer

A) Operating income is shown at standard cost. 
B) Variances are listed separately. 
C) Cost of goods sold is shown only at standard cost. 
D) Sales revenue is shown only at standard revenue. 
A) Operating income is shown at standard cost. 
B) Variances are listed separately. 
C) Cost of goods sold is shown only at standard cost. 
D) Sales revenue is shown only at standard revenue.

Question 10

A standard cost income statement shows cost of goods sold at standard and then actual cost.

Accepted Answer

A) True 
 B)False

Question 11

The unemployment rate is high in the city in which a company has a factory.The company finds that they are able to pay new employees a lower wage per hour than when the unemployment rate was lower a year ago.Which of the following variances may be directly impacted?

Accepted Answer

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

Question 12

Identify four advantages of standard costs and variances.

Accepted Answer

Student responses will vary but should i

Question 13

The managerial accountant at Aquatics Pools and Spas assess a fixed overhead budget variance of $3,400 U in the month of April.The standard hours in April were 2,900 hours and the standard rate was projected at $13 per machine-hour.There were unforeseen complications that involved raw materials and the standard rate projected per machine hour-was inaccurate.What was the standard rate per-machine hour if the standard fixed overhead cost of production is $41,100? What is the budgeted fixed overhead amount if the actual fixed overhead is $43,100?

Accepted Answer

A) $14.17 /machine hour;$39,700 
B) $13.86 /machine hour;$44,500 
C) $14.15 /machine hour;$46,500 
D) $12.15 /machine hour;$40,200 
A) $14.17 /machine hour;$39,700 
B) $13.86 /machine hour;$44,500 
C) $14.15 /machine hour;$46,500 
D) $12.15 /machine hour;$40,200

Question 14

Active Lifestyle Beverages gathered the following information for Job #928:
 
What is the direct labor efficiency variance?

Accepted Answer

A) $260 favorable 
B) $260 unfavorable 
C) $270 favorable 
D) $270 unfavorable 
A) $260 favorable 
B) $260 unfavorable 
C) $270 favorable 
D) $270 unfavorable

Question 15

Just as in job costing,the manufacturing costs flow through the inventory accounts in the following order: raw materials → work in process → cost of goods sold → finished goods.

Accepted Answer

A) True 
 B)False

Question 16

When a company uses direct materials,the amount of the debit to Work in Process Inventory is based on the standard quantity of the materials that should have been used times the Standard price (SP)per unit of the materials.

Accepted Answer

A) True 
 B)False

Question 17

Schenley Manufacturing builds playground equipment that it sells to elementary schools and municipalities.Schenley's management has contracted you to perform a variance analysis on the fixed manufacturing overhead for its line of slides.Schenley's cost accounting team informs you that it allocates fixed overhead based on machine hours.This period production was budgeted at 375 slides.Budgeted and actual production data follows:
 
What is the fixed manufacturing overhead budget variance in this period?

Accepted Answer

A) $2,750 unfavorable 
B) $1,320 unfavorable 
C) $2,750 favorable 
D) $1,320 favorable 
A) $2,750 unfavorable 
B) $1,320 unfavorable 
C) $2,750 favorable 
D) $1,320 favorable

Question 18

Newtowne Bakery bakes fresh pies that are very popular with the local residents.For July,Newtowne Bakery budgeted 750 direct labor hours to produce 500 pies.In July,Newtowne Bakery actually produced 520 pies and actually used 800 direct labor hours.The standard hours allowed during July may have been closest to

Accepted Answer

A) 832. 
B) 750. 
C) 780. 
D) 721. 
A) 832. 
B) 750. 
C) 780. 
D) 721.

Question 19

The ________ department may be responsible to incur a "direct labor rate variance."

Accepted Answer

A) finance 
B) marketing 
C) personnel 
D) purchasing 
A) finance 
B) marketing 
C) personnel 
D) purchasing

Question 20

On the line in front of each variance,enter the letters of the items needed to compute that variance.You will enter more than one item on each line.
A.Actual Price (AP)
B.Actual Quantity (AQ)
C.Standard Price (SP)
D.Standard quantity

Accepted Answer

A,B,C Direct materia

What type of variance results when the actual fixed overhead costs incurred are greater than the budgeted fixed overhead costs?

Sherwin Chemicals produces commercial strength cleansing supplies.Two of its main products are window cleanser that uses ammonia,and floor cleanser that uses bleach.Information for the most recent period follows: What is the direct materials price variance for ammonia?

If the actual number of units produced is less than the number of units budgeted to produced,then the fixed overhead volume variance will always be unfavorable.

Dorsey Corporation Company budgeted 600 pounds of direct materials costing $28.00 per pound to make 7,000 units of product.The company actually used 630 pounds of direct materials costing $30.00 per pound to make the 7,000 units.What is the direct materials quantity variance?

A(n)________ is a carefully predetermined cost that is usually expressed on a per unit basis.

The cause of a fixed overhead variance,such as an unanticipated increase or decrease in property taxes at the factory,is always under the control of management.

Regarding a standard cost income statement,which of the following is true?

A standard cost income statement shows cost of goods sold at standard and then actual cost.

The unemployment rate is high in the city in which a company has a factory.The company finds that they are able to pay new employees a lower wage per hour than when the unemployment rate was lower a year ago.Which of the following variances may be directly impacted?

Identify four advantages of standard costs and variances.

Active Lifestyle Beverages gathered the following information for Job #928: What is the direct labor efficiency variance?

Just as in job costing,the manufacturing costs flow through the inventory accounts in the following order: raw materials → work in process → cost of goods sold → finished goods.

When a company uses direct materials,the amount of the debit to Work in Process Inventory is based on the standard quantity of the materials that should have been used times the Standard price (SP)per unit of the materials.

The ________ department may be responsible to incur a "direct labor rate variance."

On the line in front of each variance,enter the letters of the items needed to compute that variance.You will enter more than one item on each line. A.Actual Price (AP) B.Actual Quantity (AQ) C.Standard Price (SP) D.Standard quantity

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evaluation

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters

Exam 11: Standard Costs and Variances

What type of variance results when the actual fixed overhead costs incurred are greater than the budgeted fixed overhead costs?

Sherwin Chemicals produces commercial strength cleansing supplies.Two of its main products are window cleanser that uses ammonia,and floor cleanser that uses bleach.Information for the most recent period follows: What is the direct materials price variance for ammonia?

If the actual number of units produced is less than the number of units budgeted to produced,then the fixed overhead volume variance will always be unfavorable.

Dorsey Corporation Company budgeted 600 pounds of direct materials costing $28.00 per pound to make 7,000 units of product.The company actually used 630 pounds of direct materials costing $30.00 per pound to make the 7,000 units.What is the direct materials quantity variance?

A(n)________ is a carefully predetermined cost that is usually expressed on a per unit basis.

The cause of a fixed overhead variance,such as an unanticipated increase or decrease in property taxes at the factory,is always under the control of management.

Regarding a standard cost income statement,which of the following is true?

A standard cost income statement shows cost of goods sold at standard and then actual cost.

The unemployment rate is high in the city in which a company has a factory.The company finds that they are able to pay new employees a lower wage per hour than when the unemployment rate was lower a year ago.Which of the following variances may be directly impacted?

Identify four advantages of standard costs and variances.

Active Lifestyle Beverages gathered the following information for Job #928: What is the direct labor efficiency variance?

Just as in job costing,the manufacturing costs flow through the inventory accounts in the following order: raw materials → work in process → cost of goods sold → finished goods.

When a company uses direct materials,the amount of the debit to Work in Process Inventory is based on the standard quantity of the materials that should have been used times the Standard price (SP)per unit of the materials.

The ________ department may be responsible to incur a "direct labor rate variance."

On the line in front of each variance,enter the letters of the items needed to compute that variance.You will enter more than one item on each line. A.Actual Price (AP) B.Actual Quantity (AQ) C.Standard Price (SP) D.Standard quantity

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evaluation

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters