Question 1

In setting standards, historical experience should be used with caution because it can perpetuate operating inefficiencies.

Accepted Answer

A) True 
 B)False

Question 2

Bortello Corporation produces high-quality leather boots.The company has a standard cost system and has set the following standards for materials and labor:  
 
  During the year Bortello produced 125 boots.Actual leather purchased was 1,700 strips, at $16 per strip.There were no beginning or ending inventories of leather.Actual direct labor was 1,500 hours at $15 per hour.
-
Compute the total budget variances for materials and labor, respectively.

Accepted Answer

A)  $2,800 F and $7,500 F 
B)  $2,800 F and $7,500 U 
C)  $2,800 U and $7,500 U 
D)  $2,800 U and $7,500 F 
A)  $2,800 F and $7,500 F 
B)  $2,800 F and $7,500 U 
C)  $2,800 U and $7,500 U 
D)  $2,800 U and $7,500 F

Question 3

Standards are set by using historical experiences, ___________________, and input from operating personnel, marketing, and accounting.

Accepted Answer

The answer of Standards are set by using historical experiences,...

Question 4

Fixed overhead was budgeted at $200,000, and 25,000 direct labor hours were budgeted.If the fixed overhead volume variance was $8,000 favorable and the fixed overhead spending variance was $6,000 unfavorable, fixed overhead applied must be

Accepted Answer

A)  $208,000. 
B)  $206,000. 
C)  $202,000. 
D)  $194,000. 
A)  $208,000. 
B)  $206,000. 
C)  $202,000. 
D)  $194,000.

Question 5

During September, 40,000 units were produced.The standard quantity of material allowed per unit was 5 pounds at a standard cost of $2.50 per pound.If there was a favorable usage variance of $25,000 for September, the actual quantity of materials used must have been

Accepted Answer

A)  210,000 pounds. 
B)  190,000 pounds. 
C)  105,000 pounds. 
D)  95,000 pounds. 
A)  210,000 pounds. 
B)  190,000 pounds. 
C)  105,000 pounds. 
D)  95,000 pounds.

Question 6

_________________ occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage.

Accepted Answer

Unfavorabl

Question 7

AquaMarine Company's standard cost is $750,000.The allowable deviation is ±5%.Its actual costs for three months are as follows:
  The upper and lower control limits are, respectively, _____.

Accepted Answer

A)  $712,500 and $643,500 
B)  $684,200 and $557,000 
C)  $787,500 and $712,500 
D)  $742,000 and $670,000 
A)  $712,500 and $643,500 
B)  $684,200 and $557,000 
C)  $787,500 and $712,500 
D)  $742,000 and $670,000

Question 8

Which of the following is true regarding variances?

Accepted Answer

A)  Unfavorable variances occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage. 
B)  Favorable variances occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage. 
C)  Unfavorable variances are always credits. 
D)  Favorable variances are always debits. 
E)  None of these. 
A)  Unfavorable variances occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage. 
B)  Favorable variances occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage. 
C)  Unfavorable variances are always credits. 
D)  Favorable variances are always debits. 
E)  None of these.

Question 9

Which of the following is not true concerning control limits?

Accepted Answer

A)  Control limits are the top and bottom measures of the allowable range. 
B)  The upper control limit is the standard plus the allowable deviation. 
C)  The lower control limit is the standard minus the allowable deviation. 
D)  In current practice, control limits are set objectively using standard formulas. 
E)  Variances that fall outside the control limits are investigated. 
A)  Control limits are the top and bottom measures of the allowable range. 
B)  The upper control limit is the standard plus the allowable deviation. 
C)  The lower control limit is the standard minus the allowable deviation. 
D)  In current practice, control limits are set objectively using standard formulas. 
E)  Variances that fall outside the control limits are investigated.

Question 10

The _______________ computes the difference between the rate paid to direct laborers and the rate that should have been paid.

Accepted Answer

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

Question 11

The standard quantity of materials allowed can be calculated by multiplying the unit labor standard by the actual output.

Accepted Answer

A) True 
 B)False

Question 12

Seaside Company produces picture frames.During the year 190,000 picture frames were produced.Materials and labor standards for producing the picture frames are as follows: ​
​
  ​
Seaside purchased and used 400,000 pieces of wood at $2.00 each and its actual labor hours were 360,000 hours at a wage rate of $10.50.
​
What is the materials price variance?

Accepted Answer

A)  $100,000 F 
B)  $112,500 U 
C)  $135,000 F 
D)  $170,000 U 
A)  $100,000 F 
B)  $112,500 U 
C)  $135,000 F 
D)  $170,000 U

Question 13

Which of the following decisions is related to the amount of input that should be used per unit of output?

Accepted Answer

A) 
  
B)  The price decision 
C) 
  
D) 
  
E) 
  
A) 
  
B)  The price decision 
C) 
  
D) 
  
E)

Question 14

Standard cost systems are adopted

Accepted Answer

A)  to improve planning and control. 
B)  to facilitate product costing. 
C)  to improve planning and control, and to facilitate product costing. 
D)  to enhance the operational control of firms that emphasize continuous improvement. 
E)  for all of these reasons. 
A)  to improve planning and control. 
B)  to facilitate product costing. 
C)  to improve planning and control, and to facilitate product costing. 
D)  to enhance the operational control of firms that emphasize continuous improvement. 
E)  for all of these reasons.

Question 15

Which of the following is not true regarding the use of materials variance information?

Accepted Answer

A)  The purchasing agent has the responsibility for controlling the materials price variance. 
B)  The production manager is generally responsible for materials usage. 
C)  The production manager is concerned with minimizing scrap, waste, and rework. 
D)  The purchasing department is responsible for acquiring quality materials. 
E)  All of these are true. 
A)  The purchasing agent has the responsibility for controlling the materials price variance. 
B)  The production manager is generally responsible for materials usage. 
C)  The production manager is concerned with minimizing scrap, waste, and rework. 
D)  The purchasing department is responsible for acquiring quality materials. 
E)  All of these are true.

Question 16

A ______________ is the difference between the sales price needed to capture a predetermined market share and the desired per-unit profit.

Accepted Answer

The answer of A ______________ is the difference between the...

Question 17

Matching
Match each item with the correct statement below.
-These reflect the amount that should be paid for the quantity of input to be used.

Accepted Answer

A) Quantity Standards 
B) Ideal Standards 
C) Price Standards 
D) Standard Cost Sheet 
E) Upper Control Limit
F)Currently Attainable Standards
G)Kaizen Standards 
A) Quantity Standards 
B) Ideal Standards 
C) Price Standards 
D) Standard Cost Sheet 
E) Upper Control Limit
F)Currently Attainable Standards
G)Kaizen Standards

Question 18

The sum of the labor rate and labor efficiency variances will always add up to the total labor variance.

Accepted Answer

A) True 
 B)False

Question 19

____________________ is the difference between the actual and standard unit price of an input multiplied by the number of inputs used.

Accepted Answer

Price vari

Question 20

Which of the following is not true regarding engineering studies?

Accepted Answer

A)  They can determine the most efficient way to operate. 
B)  They are often achievable by operating personnel. 
C)  They provide very rigorous guidelines. 
D)  All of these statements are true. 
E)  More than two of these statements are true. 
A)  They can determine the most efficient way to operate. 
B)  They are often achievable by operating personnel. 
C)  They provide very rigorous guidelines. 
D)  All of these statements are true. 
E)  More than two of these statements are true.

In setting standards, historical experience should be used with caution because it can perpetuate operating inefficiencies.

Standards are set by using historical experiences, ___________________, and input from operating personnel, marketing, and accounting.

Fixed overhead was budgeted at $200,000, and 25,000 direct labor hours were budgeted.If the fixed overhead volume variance was $8,000 favorable and the fixed overhead spending variance was $6,000 unfavorable, fixed overhead applied must be

During September, 40,000 units were produced.The standard quantity of material allowed per unit was 5 pounds at a standard cost of $2.50 per pound.If there was a favorable usage variance of $25,000 for September, the actual quantity of materials used must have been

_________________ occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage.

AquaMarine Company's standard cost is $750,000.The allowable deviation is ±5%.Its actual costs for three months are as follows: The upper and lower control limits are, respectively, _____.

Which of the following is true regarding variances?

Which of the following is not true concerning control limits?

The _______________ computes the difference between the rate paid to direct laborers and the rate that should have been paid.

The standard quantity of materials allowed can be calculated by multiplying the unit labor standard by the actual output.

Which of the following decisions is related to the amount of input that should be used per unit of output?

Standard cost systems are adopted

Which of the following is not true regarding the use of materials variance information?

A ______________ is the difference between the sales price needed to capture a predetermined market share and the desired per-unit profit.

Matching Match each item with the correct statement below. -These reflect the amount that should be paid for the quantity of input to be used.

The sum of the labor rate and labor efficiency variances will always add up to the total labor variance.

____________________ is the difference between the actual and standard unit price of an input multiplied by the number of inputs used.

Which of the following is not true regarding engineering studies?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 10: Standard Costing and Variance Analysis

In setting standards, historical experience should be used with caution because it can perpetuate operating inefficiencies.

Standards are set by using historical experiences, ___________________, and input from operating personnel, marketing, and accounting.

Fixed overhead was budgeted at $200,000, and 25,000 direct labor hours were budgeted.If the fixed overhead volume variance was $8,000 favorable and the fixed overhead spending variance was $6,000 unfavorable, fixed overhead applied must be

During September, 40,000 units were produced.The standard quantity of material allowed per unit was 5 pounds at a standard cost of $2.50 per pound.If there was a favorable usage variance of $25,000 for September, the actual quantity of materials used must have been

_________________ occur whenever actual prices or actual usage of inputs are greater than standard prices or standard usage.

AquaMarine Company's standard cost is $750,000.The allowable deviation is ±5%.Its actual costs for three months are as follows: The upper and lower control limits are, respectively, _____.

Which of the following is true regarding variances?

Which of the following is not true concerning control limits?

The _______________ computes the difference between the rate paid to direct laborers and the rate that should have been paid.

The standard quantity of materials allowed can be calculated by multiplying the unit labor standard by the actual output.

Which of the following decisions is related to the amount of input that should be used per unit of output?

Standard cost systems are adopted

Which of the following is not true regarding the use of materials variance information?

A ______________ is the difference between the sales price needed to capture a predetermined market share and the desired per-unit profit.

Matching Match each item with the correct statement below. -These reflect the amount that should be paid for the quantity of input to be used.

The sum of the labor rate and labor efficiency variances will always add up to the total labor variance.

____________________ is the difference between the actual and standard unit price of an input multiplied by the number of inputs used.

Which of the following is not true regarding engineering studies?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters