1. LO 8.1Why does a company use a standard costing system?
2.
LO 8.1This standard is set at a level that may be reached with reasonable effort.
- ideal standard
- attainable standard
- unattainable standard
- variance from standard
3.
LO 8.1This standard is set at a level that could be achieved if everything ran perfectly.
- ideal standard
- attainable standard
- unattainable standard
- variance from standard
4.
LO 8.1This variance is the difference involving spending more or using more than the standard amount.
- favorable variance
- unfavorable variance
- no variance
- variance
5.
LO 8.1This variance is the difference involving spending less, or using less than the standard amount.
- favorable variance
- unfavorable variance
- no variance
- variance
6.
LO 8.2What are some possible reasons for a material price variance?
- substandard material
- labor rate increases
- labor rate decreases
- labor efficiency
7.
LO 8.2When is the material price variance unfavorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
8.
LO 8.2When is the material price variance favorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
9.
LO 8.2What are some reasons for a material quantity variance?
- building rental charges increase
- labor rate decreases
- more qualified workers
- change in the actual cost of materials
10.
LO 8.2When is the material quantity variance favorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
11.
LO 8.2When is the material quantity unfavorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
12.
LO 8.3What are some possible reasons for a labor rate variance?
- hiring of less qualified workers
- an excess of material usage
- material price increase
- utilities usage change
13.
LO 8.3When is the labor rate variance unfavorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
14.
LO 8.3When is the labor rate variance favorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price is greater than the standard price
- when the actual price is less than the standard price
15.
LO 8.3What are some possible reasons for a direct labor time variance?
- utility usage decrease
- less qualified workers
- office supplies spending
- sales decline
16.
LO 8.3When is the direct labor time variance favorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
17.
LO 8.3When is the direct labor time variance unfavorable?
- when the actual quantity used is greater than the standard quantity
- when the actual quantity used is less than the standard quantity
- when the actual price paid is greater than the standard price
- when the actual price is less than the standard price
18.
LO 8.4A flexible budget ________.
- predicts estimated revenues and costs at varying levels of production
- gives actual figures for selling price
- gives actual figures for variable and fixed overhead
- is not used in overhead variance calculations
19.
LO 8.4The variable overhead rate variance is caused by the sum between which of the following?
- actual and standard allocation base
- actual and standard overhead rates
- actual and budgeted units
- actual units and actual overhead rates
20.
LO 8.4The variable overhead efficiency variance is caused by the difference between which of the following?
- actual and budgeted units
- actual and standard allocation base
- actual and standard overhead rates
- actual units and actual overhead rates
21.
LO 8.4The fixed factory overhead variance is caused by the difference between which of the following?
- actual and standard allocation base
- actual and budgeted units
- actual fixed overhead and applied fixed overhead
- actual and standard overhead rates
22.
LO 8.5Which of the following is a possible cause of an unfavorable material price variance?
- purchasing too much material
- purchasing higher-quality material
- hiring substandard workers
- buying substandard material
23.
LO 8.5Which of the following is a possible cause of an unfavorable material quantity variance?
- purchasing substandard material
- hiring higher-quality workers
- paying more than should have for workers
- purchasing too much material
24.
LO 8.5Which of the following is a possible cause of an unfavorable labor efficiency variance?
- hiring substandard workers
- making too many units
- buying higher-quality material
- paying too much for workers
25.
LO 8.5Which of the following is a possible cause of an unfavorable labor rate variance?
- hiring too many workers
- hiring higher-quality workers at a higher wage
- making too many units
- purchasing too much material