Exam 10: Standard Costing and Variance Analysis

During October, 10,000 direct labor hours were worked at a standard cost of $10 per hour.If the direct labor rate variance for October was $4,000 unfavorable, the actual cost per direct labor hour must be

Responsibility for variable overhead spending and efficiency variances is generally assigned to production departments.

Extreme Builders constructs houses.The standard labor rate is $25 per hour and the standard number of hours is 15,000 hours per home.During the year, it constructed 12 homes using 18,000 labor hours per home and a rate of $28 per hour ​ Calculate the Extreme Builders' labor rate variance.

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

An unfavorable price variance occurs whenever the actual prices are greater than the standard prices.

Ketone Inc.produces small engines.For last year's operations, the following data were gathered: Ketone Inc.employs a standard costing system.During the year, a variable overhead rate of $5.00 was used.The labor standard requires 1 hour per unit produced.The variable overhead spending and efficiency variances are:

Kris Company calculates its predetermined rates using practical volume, which is 325,000 units.The standard cost system allows 3 direct labor hours per unit produced.Overhead is applied using direct labor hours.The total budgeted overhead is $4,260,000, of which $994,000 is fixed overhead.The actual results for the year are as follows: - The predetermined fixed overhead rate is

The variable overhead efficiency variance is directly related to the __________________ or usage variance.

When overhead is applied on the basis of direct labor hours, the variable overhead efficiency variance always has the same sign as the labor efficiency variance.

Which of the following formulas computes usage (efficiency) variance?

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

In setting price standards for materials and labor,

The fixed overhead spending variance is affected primarily by changes in production levels.

The variable overhead spending variance is expressed as the difference between:

The materials price variance is computed using the actual quantity of materials used, and the materials usage variance is computed using the actual quantity of materials purchased.

________________ demands maximum efficiency and can be achieved only if everything operates perfectly.

The standard cost per unit of output for a particular input is calculated by multiplying the standard input price by the standard input allowed per unit of output produced.

The _____ shows the quantity of each input that should be used to produce one unit of output.

Which of the following statements is true of a normal costing system?

Mover Company has developed the following standards for one of its products: The following activity occurred during March: The company records materials price variances at the time of purchase.The variable standard cost per unit for materials and labor is