1) Standard costs for company products are typically used for all except which of the following?
Question 1 options:
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Variance analysis and cost control |
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Computing production costs in operating budgets |
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Determining actual costs per unit |
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Determining the cost of goods completed and transferred to finished goods inventory |
2) Performance reports normally include all of the following except
Question 2 options:
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standard costs. |
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normal capacity. |
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total plantwide overhead costs. |
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budgeted costs. |
3) Which of the following provides an explanation of why the variable overhead rate is separated from the
fixed overhead rate in standard costing?
Question 3 options:
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There is no justifiable reason; their separation is merely to simplify entries. |
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Both calculations divide by the same direct labor hours, but the numerator is different for each calculation. |
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The variable overhead rate is calculated using actual direct labor hours, whereas the fixed overhead rate is |
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Different application bases are generally appropriate. |
4) Multiplying the standard price of direct materials by the standard quantity for direct materials
yields
Question 4 options:
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the direct materials price variance. |
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the direct materials quantity variance. |
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the standard direct materials cost. |
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nothing; the two components should be added together. |
5) An expression of the hourly labor pay cost per function or job classification that is expected to exist
during the next accounting period is the definition of a
Question 5 options:
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direct labor time standard. |
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direct materials quantity standard. |
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direct labor rate standard. |
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variable overhead rate. |
6) A flexible budget is most useful
Question 6 options:
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for budgeting and planning purposes. |
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when actual output equals budgeted output. |
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as a cost control tool to help evaluate performance. |
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when a product’s cost structure includes variable costs only. |
7) In a standard costing system, standard costs eventually flow into the
Question 7 options:
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Cost of Goods Sold account. |
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Standard Cost account. |
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Selling and Administrative Expenses account. |
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Sales account. |
8) The difference between actual quantity used and standard quantity multiplied by standard price is the equation for computing
the
Question 8 options:
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direct labor efficiency variance. |
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direct materials price variance. |
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direct labor rate variance. |
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direct materials quantity variance. |
9) Which of the following statements is not true?
Question 9 options:
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Performance reports should be tailored to the responsibilities of the manager or department for which they are |
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Performance reports normally report standard costs and variances. |
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Performance reports should contain space for explanation of variances. |
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Performance reports do not present the causes of variances. |
10) Suppose the standard for a given cost during a period was $80,000. The actual cost for the period was $72,000. Under what
circumstances would you consider the variance from budget to be a positive performance indication?
Question 10 options:
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The cost is fixed, and actual production was 90 percent of the standard level of budgeted production. |
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The cost is variable, and the standard cost noted above is the cost at a production level lower than the actual |
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The cost is variable, and actual production was 90 percent of the standard level of production. |
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The cost is variable, and actual production was 75 percent of the standard level of production |
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