Question 1

The difference between actual price per unit of input and the standard price per unit of input results in a:

Accepted Answer

A)  Standard variance. 
B)  Controllable variance. 
C)  Volume variance. 
D)  Quantity variance. 
E)  Price variance. 
A)  Standard variance. 
B)  Controllable variance. 
C)  Volume variance. 
D)  Quantity variance. 
E)  Price variance.

Question 2

Milltown Company specializes in selling used cars. During the month, the dealership sold 22 cars at an average price of $15,000 each. The budget for the month was to sell 20 cars at an average price of $16,000.
- Compute the dealership's sales price variance for the month.

Accepted Answer

A)  $22,000 unfavorable. 
B)  $22,000 favorable. 
C)  $32,000 favorable. 
D)  $32,000 unfavorable. 
E)  $10,000 favorable. 
A)  $22,000 unfavorable. 
B)  $22,000 favorable. 
C)  $32,000 favorable. 
D)  $32,000 unfavorable. 
E)  $10,000 favorable.

Question 3

The purchasing department is usually responsible for the price paid for materials.

Accepted Answer

A) True 
 B)False

Question 4

Differences between actual costs and standard costs are known as ________. These differences may be subdivided into ________ and ________.

Accepted Answer

cost variances (or j

Question 5

Explain variance analysis. Describe how variance analysis assists managers.

Accepted Answer

Variance analysis compares actual result

Question 6

A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z. The company has just produced 1,000 units of this product, using 5,200 pounds of Material J that cost $9,880. The direct materials quantity variance is:

Accepted Answer

A)  $120 favorable. 
B)  $400 unfavorable. 
C)  $520 unfavorable. 
D)  $520 favorable. 
E)  $400 favorable. 
A)  $120 favorable. 
B)  $400 unfavorable. 
C)  $520 unfavorable. 
D)  $520 favorable. 
E)  $400 favorable.

Question 7

The following information describes production activities of the Midtown Corp.:
$\begin{array}{llr}
  \text { Raw materials used } & \text {  16,000 lbs. at $ \$ 4.05 $ per $ \mathrm{lb} $}\
 \text { Factory payroll  } & \text {  5,545 hours for a total of $ \$ 72,085 $} \
\end{array}$
 
30,000 units were completed during the year Budgeted standards for each unit produced: 1/2 lb. of raw material at $4.15 per lb.
10 minutes of direct labor at $12.50 per hour
Compute the direct materials price and quantity and the direct labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

Accepted Answer

The answer of The following information describes production activities of...

Question 8

Claremont Company specializes in selling refurbished copiers. During the month, the company sold 180 copiers at an average price of $3,000 each. The budget for the month was to sell 175 copiers at an average price of $3,200.
- The expected total sales for 180 copiers were:

Accepted Answer

A)  $576,000. 
B)  $550,000. 
C)  $540,000. 
D)  $560,000. 
E)  $525,000. 
A)  $576,000. 
B)  $550,000. 
C)  $540,000. 
D)  $560,000. 
E)  $525,000.

Question 9

A company's flexible budget for 36,000 units of production showed variable overhead costs of
$54,000 and fixed overhead costs of $50,000. The company actually incurred total overhead costs of $95,300 while operating at a volume of 32,000 units. What is the controllable variance?

Accepted Answer

* $54,000 variable o

Question 10

The difference between the flexible budget sales and the fixed budget sales is called the ________ variance.

Accepted Answer

The answer of The difference between the flexible budget sales...

Question 11

A company's flexible budget for 12,000 units of production showed sales, $48,000; variable costs, $18,000; and fixed costs, $16,000. The fixed costs expected if the company produces and sells 16,000 units is:

Accepted Answer

A)  $64,000. 
B)  $16,000. 
C)  $18,000. 
D)  $24,000. 
E)  $48,000. 
A)  $64,000. 
B)  $16,000. 
C)  $18,000. 
D)  $24,000. 
E)  $48,000.

Question 12

Grant Co. uses the following standard to produce a single unit of its product: Variable overhead (2 hrs. per unit @ $4/hr.) Actual data for the month show total variable overhead costs of $190,000, and 23,000 units produced. The total variable overhead variance is:

Accepted Answer

A)  $78,000F. 
B)  $78,000U. 
C)  $6,000U. 
D)  $0. 
E)  $6,000F. 
A)  $78,000F. 
B)  $78,000U. 
C)  $6,000U. 
D)  $0. 
E)  $6,000F.

Question 13

The fixed overhead variance can be broken down into the ________ variance and the ________ variance.

Accepted Answer

The answer of The fixed overhead variance can be broken...

Question 14

Parallel Enterprises has collected the following data on one of its products. During the period the company produced 25,000 units. The direct materials quantity variance is: Direct materials standard (7 kg. @ $2/kg) $ 14 per finished unit
Actual cost of materials purchased $ 322,500 Actual direct materials purchased and used  150,000  kg

Accepted Answer

A)  $50,000 unfavorable. 
B)  $22,500 favorable. 
C)  $50,000 favorable. 
D)  $27,500 unfavorable. 
E)  $22,500 unfavorable. 
A)  $50,000 unfavorable. 
B)  $22,500 favorable. 
C)  $50,000 favorable. 
D)  $27,500 unfavorable. 
E)  $22,500 unfavorable.

Question 15

Cavern Company's output for the current period results in a $5,250 unfavorable direct material price variance. The actual price per pound is $56.50 and the standard price per pound is $55.00. How many pounds of material are used in the current period?

Accepted Answer

A)  3,750. 
B)  4,000. 
C)  5,393. 
D)  3,500. 
E)  5,110. 
A)  3,750. 
B)  4,000. 
C)  5,393. 
D)  3,500. 
E)  5,110.

Question 16

Match between columns
                        Premises:  Results from a comparison of actual cost or revenue to budget that contributes to a lower income.
 A report that compares actual results with the results expected under a fixed budget.
 When management pays an amount different from the standard price to acquire an item.
 Results from a comparison of actual cost or revenue to budget that contributes to higher income.
 Management's use of budgets to see that planned objectives are met.
 Difference between actual quantity of an input and the standard quantity of the input.
 Difference between the total overhead cost applied to products and the total overhead cost actually incurred.
 A report that compares actual performance and budgeted performance based on actual sales volume or other activity level.

Accepted Answer

The Answer of Unfavorable variance and Fixed budget performance report is...

Question 17

A company's flexible budget for 12,000 units of production showed sales, $48,000; variable costs, $18,000; and fixed costs, $16,000. The contribution margin expected if the company produces and sells 16,000 units is:

Accepted Answer

A)  $18,000. 
B)  $64,000. 
C)  $48,000. 
D)  $40,000. 
E)  $24,000. 
A)  $18,000. 
B)  $64,000. 
C)  $48,000. 
D)  $40,000. 
E)  $24,000.

Question 18

Direct materials variances are called price and quantity variances. However, when referring to direct labor, these variances are usually called ________and ___________variances.

Accepted Answer

The answer of Direct materials variances are called price and...

Question 19

Naches Co. assigned direct labor cost to its products in May for 1,300 standard hours of direct labor at the standard $8 per hour rate. The direct labor rate variance for the month was $200 favorable and the direct labor efficiency variance was $150 favorable. Prepare the journal entry to charge Work in Process Inventory for the standard labor cost of the goods manufactured in May and to record the direct labor variances. Assuming that the direct labor variances are immaterial, prepare the journal entry that Naches would make to close the variance accounts.

Accepted Answer

None

Question 20

During November, Gliem Company allocated overhead to products at the rate of $26.00 per direct labor hour. This figure was based on 80% of capacity or 1,600 direct labor hours. However, Gliem Company operated at only 70% of capacity, or 1,400 direct labor hours. Budgeted overhead at 70% of capacity is $38,900, and overhead actually incurred was $38,000. What is the company's volume variance for November? (Indicate whether the variance is favorable or unfavorable)

Accepted Answer

None

Exam 23: Flexible Budgets and Standard Costs

The difference between actual price per unit of input and the standard price per unit of input results in a:

Milltown Company specializes in selling used cars. During the month, the dealership sold 22 cars at an average price of $15,000 each. The budget for the month was to sell 20 cars at an average price of $16,000. - Compute the dealership's sales price variance for the month.

The purchasing department is usually responsible for the price paid for materials.

Differences between actual costs and standard costs are known as ________. These differences may be subdivided into ________ and ________.

Explain variance analysis. Describe how variance analysis assists managers.

A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z. The company has just produced 1,000 units of this product, using 5,200 pounds of Material J that cost $9,880. The direct materials quantity variance is:

Claremont Company specializes in selling refurbished copiers. During the month, the company sold 180 copiers at an average price of $3,000 each. The budget for the month was to sell 175 copiers at an average price of $3,200. - The expected total sales for 180 copiers were:

A company's flexible budget for 36,000 units of production showed variable overhead costs of $54,000 and fixed overhead costs of $50,000. The company actually incurred total overhead costs of $95,300 while operating at a volume of 32,000 units. What is the controllable variance?

The difference between the flexible budget sales and the fixed budget sales is called the ________ variance.

A company's flexible budget for 12,000 units of production showed sales, $48,000; variable costs, $18,000; and fixed costs, $16,000. The fixed costs expected if the company produces and sells 16,000 units is:

Grant Co. uses the following standard to produce a single unit of its product: Variable overhead (2 hrs. per unit @ $4/hr.) Actual data for the month show total variable overhead costs of $190,000, and 23,000 units produced. The total variable overhead variance is:

The fixed overhead variance can be broken down into the ________ variance and the ________ variance.

Cavern Company's output for the current period results in a $5,250 unfavorable direct material price variance. The actual price per pound is $56.50 and the standard price per pound is $55.00. How many pounds of material are used in the current period?

A company's flexible budget for 12,000 units of production showed sales, $48,000; variable costs, $18,000; and fixed costs, $16,000. The contribution margin expected if the company produces and sells 16,000 units is:

Direct materials variances are called price and quantity variances. However, when referring to direct labor, these variances are usually called ________and ___________variances.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets Natural Resoures and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Present and Future Values in Accounting

Activity-Based Costing

Filters

Differences between actual costs and standard costs are known as . These differences may be subdivided into and .

The fixed overhead variance can be broken down into the variance and the variance.

Direct materials variances are called price and quantity variances. However, when referring to direct labor, these variances are usually called and ___variances.