Question 1

The variance from standard for factory overhead cost resulting from operating at a level above or below 100% of normal capacity is termed volume variance.

Accepted Answer

A) True 
 B)False  True

Question 2

Flexible budgeting builds the effect of changes in level of activity into the budget system.

Accepted Answer

A) True 
 B)False  True

Question 3

Principal components of a master budget include which of the following?

Accepted Answer

A) Production budget 
B) Sales budget 
C) Capital expenditures budget 
D) All of these 
A) Production budget 
B) Sales budget 
C) Capital expenditures budget 
D) All of these D

Question 4

The standard costs and actual costs for direct materials,direct labor,and factory overhead for the manufacture of 2,500 units of product are as follows:
   Variable cost @ $2 per hour
Total variable cost,$18,000
Fixed cost @ $0.80 per hour
Total fixed cost,$8,000
-The amount of the direct labor rate variance is

Accepted Answer

A) $4,440 unfavorable. 
B) $4,500 favorable. 
C) $4,440 favorable. 
D) $4,500 unfavorable. 
A) $4,440 unfavorable. 
B) $4,500 favorable. 
C) $4,440 favorable. 
D) $4,500 unfavorable.

Question 5

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Accepted Answer

A) True 
 B)False

Question 6

Nonmanufacturing activities are usually controlled using a static budget rather than a standard costing system.

Accepted Answer

A) True 
 B)False

Question 7

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended:
  
-The direct labor rate variance is

Accepted Answer

A) $135,000 unfavorable. 
B) $89,100 favorable. 
C) $89,100 unfavorable. 
D) $121,500 unfavorable. 
A) $135,000 unfavorable. 
B) $89,100 favorable. 
C) $89,100 unfavorable. 
D) $121,500 unfavorable.

Question 8

The following data relate to direct labor costs for the current period:
 
What is the direct labor rate variance?

Accepted Answer

A) $2,250.00 unfavorable 
B) $2,187.50 unfavorable 
C) $2,250.00 favorable 
D) $2,187.50 favorable 
A) $2,250.00 unfavorable 
B) $2,187.50 unfavorable 
C) $2,250.00 favorable 
D) $2,187.50 favorable

Question 9

The controllable variance measures

Accepted Answer

A) operating results at less than normal capacity. 
B) the efficiency of using variable overhead resources. 
C) operating results at more than normal capacity. 
D) control over fixed overhead costs. 
A) operating results at less than normal capacity. 
B) the efficiency of using variable overhead resources. 
C) operating results at more than normal capacity. 
D) control over fixed overhead costs.

Question 10

Budgets are normally used by both profit-making businesses and nonprofit organizations.

Accepted Answer

A) True 
 B)False

Question 11

Based on the following production and sales data of Jackson Co.for March of the current year,prepare (a)a sales budget and (b)a production budget.

Accepted Answer

The answer of Based on the following production and sales...

Question 12

Assuming that the standard fixed overhead rate is based on full capacity,the cost of available but unused productive capacity is indicated by the

Accepted Answer

A) factory overhead cost volume variance. 
B) direct labor cost time variance. 
C) direct labor cost rate variance. 
D) factory overhead cost controllable variance. 
A) factory overhead cost volume variance. 
B) direct labor cost time variance. 
C) direct labor cost rate variance. 
D) factory overhead cost controllable variance.

Question 13

If the price paid per unit differs from the standard price per unit for direct materials,the variance is termed

Accepted Answer

A) variable variance. 
B) controllable variance. 
C) price variance. 
D) volume variance. 
A) variable variance. 
B) controllable variance. 
C) price variance. 
D) volume variance.

Question 14

The first budget to be prepared is usually the sales budget.

Accepted Answer

A) True 
 B)False

Question 15

The following data relate to direct labor costs for the current period:
  
-What is the direct labor rate variance?

Accepted Answer

A) $3,000 unfavorable 
B) $3,000 favorable 
C) $2,400 unfavorable 
D) $2,400 favorable 
A) $3,000 unfavorable 
B) $3,000 favorable 
C) $2,400 unfavorable 
D) $2,400 favorable

Question 16

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended:
  
-The direct labor time variance is

Accepted Answer

A) $31,725 favorable. 
B) $32,400 favorable. 
C) $89,100 unfavorable. 
D) $121,500 unfavorable. 
A) $31,725 favorable. 
B) $32,400 favorable. 
C) $89,100 unfavorable. 
D) $121,500 unfavorable.

Question 17

The following data relate to direct labor costs for the current period:
  
-What is the direct labor time variance?

Accepted Answer

A) $17,400 favorable 
B) $17,400 unfavorable 
C) $18,000 favorable 
D) $18,000 unfavorable 
A) $17,400 favorable 
B) $17,400 unfavorable 
C) $18,000 favorable 
D) $18,000 unfavorable

Question 18

The standard factory overhead rate is $10 per direct labor hour ($8 for variable factory overhead and $2 for fixed factory overhead)based on 100% capacity of 30,000 direct labor hours.The standard cost and the actual cost of factory overhead for the production of 5,000 units during May were as follows:
  
-What is the amount of the fixed factory overhead volume variance?

Accepted Answer

A) $12,500 favorable 
B) $10,000 unfavorable 
C) $12,500 unfavorable 
D) $10,000 favorable 
A) $12,500 favorable 
B) $10,000 unfavorable 
C) $12,500 unfavorable 
D) $10,000 favorable

Question 19

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials quantity variance was $2,200 favorable.

Accepted Answer

A) True 
 B)False

Question 20

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials price variance was $800 favorable.

Accepted Answer

A) True 
 B)False

The variance from standard for factory overhead cost resulting from operating at a level above or below 100% of normal capacity is termed volume variance.

Flexible budgeting builds the effect of changes in level of activity into the budget system.

Principal components of a master budget include which of the following?

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Nonmanufacturing activities are usually controlled using a static budget rather than a standard costing system.

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended: -The direct labor rate variance is

The following data relate to direct labor costs for the current period: What is the direct labor rate variance?

The controllable variance measures

Budgets are normally used by both profit-making businesses and nonprofit organizations.

Based on the following production and sales data of Jackson Co.for March of the current year,prepare (a)a sales budget and (b)a production budget.

Assuming that the standard fixed overhead rate is based on full capacity,the cost of available but unused productive capacity is indicated by the

If the price paid per unit differs from the standard price per unit for direct materials,the variance is termed

The first budget to be prepared is usually the sales budget.

The following data relate to direct labor costs for the current period: -What is the direct labor rate variance?

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended: -The direct labor time variance is

The following data relate to direct labor costs for the current period: -What is the direct labor time variance?

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials quantity variance was $2,200 favorable.

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials price variance was $800 favorable.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

Exam 13: Budgeting and Standard Cost Systems

The variance from standard for factory overhead cost resulting from operating at a level above or below 100% of normal capacity is termed volume variance.

Flexible budgeting builds the effect of changes in level of activity into the budget system.

Principal components of a master budget include which of the following?

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

Nonmanufacturing activities are usually controlled using a static budget rather than a standard costing system.

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended: -The direct labor rate variance is

The following data relate to direct labor costs for the current period: What is the direct labor rate variance?

The controllable variance measures

Budgets are normally used by both profit-making businesses and nonprofit organizations.

Based on the following production and sales data of Jackson Co.for March of the current year,prepare (a)a sales budget and (b)a production budget.

Assuming that the standard fixed overhead rate is based on full capacity,the cost of available but unused productive capacity is indicated by the

If the price paid per unit differs from the standard price per unit for direct materials,the variance is termed

The first budget to be prepared is usually the sales budget.

The following data relate to direct labor costs for the current period: -What is the direct labor rate variance?

Efficient Corporation uses a standard cost system.The following information was provided for the period that just ended: -The direct labor time variance is

The following data relate to direct labor costs for the current period: -What is the direct labor time variance?

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials quantity variance was $2,200 favorable.

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12,the direct materials price variance was $800 favorable.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters