Question 1

The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

Accepted Answer

A)  budgeted overhead costs by an expected standard activity index.
B)  actual overhead costs by an expected standard activity index.
C)  budgeted overhead costs by actual activity.
D)  actual overhead costs by actual activity.E) B) and C)
F) C) and D)

Question 2

Unfavorable materials price and quantity variances are generally the responsibility of the $\quad$$\quad$$\quad$$\quad$Price$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$Quantity
a. Purchasing department$\quad$$\quad$ Purchasing Department
b. Purchasing department $\quad$$\quad$Production Department
c. Production department $\quad$$\quad$Production Department
d. Production Department $\quad$$\quad$Purchasing Department

Accepted Answer

The answer of Unfavorable materials price and quantity variances are...

Question 3

Using standard costs

Accepted Answer

A)  can make management planning more difficult.
B)  promotes greater economy.
C)  does not help in setting prices.
D)  weakens management control.E) C) and D)
F) None of the above

Question 4

Denmark Corporation's variance report for the purchasing department reports 1,000 units of material A purchased and 2,400 units of material B purchased. It also reports standard prices of $2 for Material A and $3 for Material B. Actual prices reported are $2.10 for Material A and $2.80 for Material B. Denmark should report a total price variance of

Accepted Answer

A)  $380 F.
B)  $340 F.
C)  $340 U.
D)  $380 U.E) C) and D)
F) B) and C)

Question 5

The two levels that standards may be set at are

Accepted Answer

A)  normal and fully efficient.
B)  normal and ideal.
C)  ideal and less efficient.
D)  fully efficient and fully effective.E) All of the above
F) B) and D)

Question 6

The difference between a budget and a standard is that

Accepted Answer

A)  a budget expresses what costs were, while a standard expresses what costs should be.
B)  a budget expresses management's plans, while a standard reflects what actually happened.
C)  a budget expresses a total amount, while a standard expresses a unit amount.
D)  standards are excluded from the cost accounting system, whereas budgets are generally incorporated into the cost accounting system.E) A) and B)
F) All of the above

Question 7

Shipp, Inc. manufactures a product requiring two pounds of direct material. During 2016, Shipp purchases 24,000 pounds of material for $99,200 when the standard price per pound is $4. During 2016, Shipp uses 22,000 pounds to make 12,000 products. The standard direct material cost per unit of finished product is

Accepted Answer

A)  $8.27.
B)  $9.01.
C)  $8.00.
D)  $8.53.E) A) and B)
F) None of the above

Question 8

The direct materials quantity standard would not be expressed in

Accepted Answer

A)  pounds.
B)  barrels.
C)  dollars.
D)  board feet.E) A) and D)
F) None of the above

Question 9

The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

Accepted Answer

A)  Favorable materials quantity variance
B)  Favorable total materials variance
C)  Unfavorable materials price variance
D)  Unfavorable labor quantity varianceE) C) and D)
F) B) and C)

Question 10

The total materials variance is equal to the

Accepted Answer

A)  materials price variance.
B)  difference between the materials price variance and materials quantity variance.
C)  product of the materials price variance and the materials quantity variance.
D)  sum of the materials price variance and the materials quantity variance.E) None of the above
F) B) and C)

Question 11

The formula for the materials price variance is

Accepted Answer

A)  (AQ × SP)  - (SQ × SP) .
B)  (AQ × AP)  - (AQ × SP) .
C)  (AQ × AP)  - (SQ × SP) .
D)  (AQ × SP)  - (SQ × AP) .E) B) and D)
F) B) and C)

Question 12

If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

Accepted Answer

A)  $3,600 F
B)  $2,700 U
C)  $900 F
D)  $4,050 UE) B) and D)
F) None of the above

Question 13

There could be instances where the production department is responsible for a direct materials price variance.

Accepted Answer

A) True 
 B)False

Question 14

Budget data are not journalized in cost accounting systems with the exception of

Accepted Answer

A)  the application of manufacturing overhead.
B)  direct labor budgets.
C)  direct materials budgets.
D)  cash budget data.E) A) and D)
F) C) and D)

Question 15

The investigation of a materials quantity variance usually begins in the

Accepted Answer

A)  production department.
B)  purchasing department.
C)  sales department.
D)  controller's department.E) None of the above
F) A) and B)

Question 16

A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Accepted Answer

A)  $2
B)  $4
C)  $6
D)  Cannot be determined from the data provided.E) All of the above
F) C) and D)

Question 17

Which of the following is true?

Accepted Answer

A)  The form, content, and frequency of variance reports vary considerably among companies.
B)  The form, content, and frequency of variance reports do not vary among companies.
C)  The form and content of variance reports vary considerably among companies, but the frequency is always weekly.
D)  The form and content of variance reports are consistent among companies, but the frequency varies.E) B) and D)
F) A) and D)

Question 18

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Accepted Answer

A) True 
 B)False

Question 19

The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

Accepted Answer

A)  total labor variance.
B)  labor price variance.
C)  labor quantity variance.
D)  labor efficiency variance.E) A) and C)
F) C) and D)

Question 20

The investigation of materials price variance usually begins in the

Accepted Answer

A)  first production department.
B)  purchasing department.
C)  controller's office.
D)  accounts payable department.E) A) and B)
F) A) and C)

Exam 22: Standard Costs and Balanced Scorecard

The investigation of a materials quantity variance usually begins in the

Correct Answer
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The direct materials quantity standard would not be expressed in

Correct Answer
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A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Correct Answer
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Which of the following is true?

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The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

Correct Answer
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The total materials variance is equal to the

Correct Answer
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The formula for the materials price variance is

Correct Answer
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The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Correct Answer
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If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

Correct Answer
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Correct Answer
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The difference between a budget and a standard is that

Correct Answer
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The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

Correct Answer
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The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

Correct Answer
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Using standard costs

Correct Answer
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The investigation of materials price variance usually begins in the

Correct Answer
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There could be instances where the production department is responsible for a direct materials price variance.

Correct Answer
verified

The two levels that standards may be set at are

Correct Answer
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Budget data are not journalized in cost accounting systems with the exception of

Correct Answer
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Correct Answer
verified

Exam 22: Standard Costs and Balanced Scorecard

The investigation of a materials quantity variance usually begins in the

Correct AnswerverifiedShow Answer

The direct materials quantity standard would not be expressed in

Correct AnswerverifiedShow Answer

A company uses 8,400 pounds of materials and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable. What is the standard price?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is true?

Correct AnswerverifiedShow Answer

The standard predetermined overhead rate used in setting the standard overhead cost is determined by dividing

Correct AnswerverifiedShow Answer

The total materials variance is equal to the

Correct AnswerverifiedShow Answer

The formula for the materials price variance is

Correct AnswerverifiedShow Answer

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.

Correct AnswerverifiedShow Answer

If the materials price variance is $3,600 F and the materials quantity and labor variances are each $2,700 U, what is the total materials variance?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The difference between a budget and a standard is that

Correct AnswerverifiedShow Answer

The difference between the actual labor rate multiplied by the actual labor hours worked and the standard labor rate multiplied by the standard labor hours is the

Correct AnswerverifiedShow Answer

The purchasing agent of the Poplin, Inc. ordered materials of lower quality in an effort to economize on price. What variance will most likely result?

Correct AnswerverifiedShow Answer

Using standard costs

Correct AnswerverifiedShow Answer

The investigation of materials price variance usually begins in the

Correct AnswerverifiedShow Answer

There could be instances where the production department is responsible for a direct materials price variance.

Correct AnswerverifiedShow Answer

The two levels that standards may be set at are

Correct AnswerverifiedShow Answer

Budget data are not journalized in cost accounting systems with the exception of

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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