Question 1

Dillon has a standard of 2 hours of labor per unit, at $12 per hour. In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970. Dillon's labor price variance is

Accepted Answer

A)   $770 U.
B)   $800 U.
C)   $1,030 F.
D)   $1,930 F.E) A) and C)
F) A) and D)

Question 2

Allowances should not be made in the direct labor quantity standard for

Accepted Answer

A)   wasted time.
B)   rest periods.
C)   cleanup.
D)   machine downtime.E) B) and D)
F) A) and D)

Question 3

Prescott Manufacturing manufactures widgets for distribution. The standard costs for the manufacture of widgets follow:
Budgeted factory overhead was $640,000. Overhead applied is based on widgets produced. The company estimated that 10,000 widgets would be produced; however, only 9,600 were produced.
Instructions
Calculate the following amounts.
1. Rate at which total factory overhead is applied
2. Materials price variance
3. Total materials variance
4. Overhead volume variance
5. Overhead controllable variance

Accepted Answer

1. Budgeted overhead cost/budgeted activ...

Question 4

Variances from standards are

Accepted Answer

A)   expressed in total dollars.
B)   expressed on a per-unit basis.
C)   expressed on a percentage basis.
D)   All of these answers are correct.E) A) and D)
F) B) and D)

Question 5

Standard costs

Accepted Answer

A)   may show past cost experience.
B)   help establish expected future costs.
C)   are the budgeted cost per unit in the present.
D)   All of these answers are correct.E) A) and B)
F) None of the above

Question 6

Purvis Manufacturing, which produces a single product, has prepared the following standard cost sheet for one unit of the product.
Direct materials (6 pounds at $2 per pound) $12
Direct labor (2 hours at $12 per hour) $24
During the month of April, the company manufactures 300 units and incurs the following actual costs.
Direct materials purchased and used (1,850 pounds) $4,070
Direct labor (620 hours) $7,130
Instructions
Compute the total, price, and quantity variances for materials and labor.

Accepted Answer

Total materials variance:
(AQ * AP ) - (...

Question 7

A company developed the following per-unit standards for its product: 2 gallons of direct materials at $8 per gallon. Last month, 3,000 gallons of direct materials were purchased for $22,800. The direct materials price variance for last month was

Accepted Answer

A)   $22,800 favorable.
B)   $600 favorable.
C)   $1,200 favorable.
D)   $1,200 unfavorable.E) A) and B)
F) None of the above

Question 8

Inventories cannot be valued at standard cost in financial statements.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about standard costs is false?

Accepted Answer

A)   Properly set standards should promote efficiency.
B)   Standard costs facilitate management planning.
C)   Standards should not be used in "management by exception."
D)   Standard costs can simplify the costing of inventories.E) B) and C)
F) All of the above

Question 10

Marburg Co. expects direct materials cost of $6 per unit for 100,000 units (a total of $600,000 of direct materials costs) . Marburg's standard direct materials cost and budgeted direct materials cost is
Standard Budgeted

Accepted Answer

A)   $6 per unit $600,000 per year
B)   $6 per unit $6 per unit
C)   $600,000 per year $6 per unit
D)   $600,000 per year $600,000 per yearE) A) and B)
F) A) and C)

Question 11

A ________________ is expressed as a unit amount, whereas a _________________ is expressed as a total amount.

Accepted Answer

The answer of A ________________ is expressed as a unit...

Question 12

The overhead controllable variance relates primarily to fixed overhead costs.

Accepted Answer

A) True 
 B)False

Question 13

If actual direct materials costs are greater than standard direct materials costs, it means that

Accepted Answer

A)   actual costs were calculated incorrectly.
B)   the actual unit price of direct materials was greater than the standard unit price of direct materials.
C)   the actual unit price of raw materials or the actual quantities of raw materials used was greater than the standard unit price or standard quantities of raw materials expected.
D)   the purchasing agent or the production foreman is inefficient.E) B) and D)
F) A) and B)

Question 14

Dillon has a standard of 1.5 pounds of materials per unit, at $6 per pound. In producing 2,000 units, Dillon used 3,100 pounds of materials at a total cost of $18,135. Dillon's total variance is

Accepted Answer

A)   $450 F.
B)   $135 U.
C)   $465 U.
D)   $600 U.E) A) and D)
F) None of the above

Question 15

A direct labor price standard is frequently called the direct labor efficiency standard.

Accepted Answer

A) True 
 B)False

Question 16

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) A) and D)

Question 17

Which of the following statements is true?

Accepted Answer

A)   Variances are the differences between total actual costs and total standard costs.
B)   When actual costs exceed standard costs, the variance is favorable.
C)   An unfavorable variance results when actual costs are decreasing but standards are not changed.
D)   All of the above are true.E) A) and C)
F) A) and B)

Question 18

A standard is a unit amount, whereas a budget is a total amount.

Accepted Answer

A) True 
 B)False

Question 19

The direct materials quantity standard should

Accepted Answer

A)   exclude unavoidable waste.
B)   exclude quality considerations.
C)   allow for normal spoilage.
D)   always be expressed as an ideal standard.E) None of the above
F) B) and C)

Question 20

The total standard cost to produce one unit of product is shown

Accepted Answer

A)   at the bottom of the income statement.
B)   at the bottom of the balance sheet.
C)   on the standard cost card.
D)   in the Work in Process Inventory account.E) All of the above
F) A) and B)

Exam 24: Standard Costs and Balanced Scorecard

Allowances should not be made in the direct labor quantity standard for

Correct Answer
verified

A is expressed as a unit amount, whereas a _ is expressed as a total amount.

Correct Answer
verified

Marburg Co. expects direct materials cost of $6 per unit for 100,000 units (a total of $600,000 of direct materials costs) . Marburg's standard direct materials cost and budgeted direct materials cost is Standard Budgeted

Correct Answer
verified

Variances from standards are

Correct Answer
verified

The overhead controllable variance relates primarily to fixed overhead costs.

Correct Answer
verified

A company developed the following per-unit standards for its product: 2 gallons of direct materials at $8 per gallon. Last month, 3,000 gallons of direct materials were purchased for $22,800. The direct materials price variance for last month was

Correct Answer
verified

Dillon has a standard of 2 hours of labor per unit, at $12 per hour. In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970. Dillon's labor price variance is

Correct Answer
verified

Standard costs

Correct Answer
verified

Correct Answer
verified
Total materials variance:
(AQ * AP ) - (...
View Answer

Correct Answer
verified
1. Budgeted overhead cost/budgeted activ...
View Answer

The total standard cost to produce one unit of product is shown

Correct Answer
verified

A direct labor price standard is frequently called the direct labor efficiency standard.

Correct Answer
verified

The direct materials quantity standard should

Correct Answer
verified

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

Correct Answer
verified

Dillon has a standard of 1.5 pounds of materials per unit, at $6 per pound. In producing 2,000 units, Dillon used 3,100 pounds of materials at a total cost of $18,135. Dillon's total variance is

Correct Answer
verified

Inventories cannot be valued at standard cost in financial statements.

Correct Answer
verified

If actual direct materials costs are greater than standard direct materials costs, it means that

Correct Answer
verified

Which of the following statements is true?

Correct Answer
verified

Which of the following statements about standard costs is false?

Correct Answer
verified

A standard is a unit amount, whereas a budget is a total amount.

Correct Answer
verified

Exam 24: Standard Costs and Balanced Scorecard

Allowances should not be made in the direct labor quantity standard for

Correct AnswerverifiedShow Answer

A ________________ is expressed as a unit amount, whereas a _________________ is expressed as a total amount.

Correct AnswerverifiedShow Answer

Marburg Co. expects direct materials cost of $6 per unit for 100,000 units (a total of $600,000 of direct materials costs) . Marburg's standard direct materials cost and budgeted direct materials cost is Standard Budgeted

Correct AnswerverifiedShow Answer

Variances from standards are

Correct AnswerverifiedShow Answer

The overhead controllable variance relates primarily to fixed overhead costs.

Correct AnswerverifiedShow Answer

A company developed the following per-unit standards for its product: 2 gallons of direct materials at $8 per gallon. Last month, 3,000 gallons of direct materials were purchased for $22,800. The direct materials price variance for last month was

Correct AnswerverifiedShow Answer

Dillon has a standard of 2 hours of labor per unit, at $12 per hour. In producing 2,000 units, Dillon used 3,850 hours of labor at a total cost of $46,970. Dillon's labor price variance is

Correct AnswerverifiedShow Answer

Standard costs

Correct AnswerverifiedShow Answer

Correct AnswerverifiedTotal materials variance:(AQ * AP ) - (...View AnswerShow Answer

Correct Answerverified1. Budgeted overhead cost/budgeted activ...View AnswerShow Answer

The total standard cost to produce one unit of product is shown

Correct AnswerverifiedShow Answer

A direct labor price standard is frequently called the direct labor efficiency standard.

Correct AnswerverifiedShow Answer

The direct materials quantity standard should

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Dillon has a standard of 1.5 pounds of materials per unit, at $6 per pound. In producing 2,000 units, Dillon used 3,100 pounds of materials at a total cost of $18,135. Dillon's total variance is

Correct AnswerverifiedShow Answer

Inventories cannot be valued at standard cost in financial statements.

Correct AnswerverifiedShow Answer

If actual direct materials costs are greater than standard direct materials costs, it means that

Correct AnswerverifiedShow Answer

Which of the following statements is true?

Correct AnswerverifiedShow Answer

Which of the following statements about standard costs is false?

Correct AnswerverifiedShow Answer

A standard is a unit amount, whereas a budget is a total amount.

Correct AnswerverifiedShow Answer

Correct Answer
verified

A is expressed as a unit amount, whereas a _ is expressed as a total amount.

Correct Answer
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Total materials variance:
(AQ * AP ) - (...
View Answer

Correct Answer
verified
1. Budgeted overhead cost/budgeted activ...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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