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Exam 29: Controlling Manufacturing Costs: Standard Costs

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Question 1

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Direct factory labor is usually considered to be

A) a variable cost.
B) a fixed cost.
C) a semi-variable cost.
D) a mixed cost.

E) None of the above
F) C) and D)

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Question 2

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SweetBerry Ice-creams uses a standard cost system.The following data is available for June: The actual material cost for June was:

A) $48,000.
B) $50,400.
C) $49,770.
D) $51,030.

E) B) and D)
F) All of the above

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Question 3

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Two variances associated with analyzing manufacturing overhead costs are the production volume variance and the flexible budget variance.

Costs that tend to change in total directly with the volume of manufacturing activity are called ____________________ costs.

The high-low point method results can be misleading if the activity is not reflective of the normal activity.

Examples of fixed manufacturing costs include all of the following except:

The Hoatzin Birdhouse Factory produced the following standard cost card.In July,the company had an order for 500 birdhouses (Model: Wren)for Job No.CB32.Manufacturing overhead is based on direct labor hours.The manufacturing overhead cost estimates for the year total $32,400 and total direct labor hours are estimated at 9,000 for the year.Complete the Standard Cost Card and Job Order Cost Sheet.Calculate the total cost variance.

The difference between the total standard cost and the total actual cost is the ___________________.

Better Blankets,Inc.makes a SnuggieBlank using flannel material and trim binding.They have instituted a successful JIT system and thus no longer have to stock inventory prior to their production need.The Standard Cost Card for The SnuggieBlank model is shown. The company reported the following results concerning January results: The material price variance for Trim used in January is:

As the level of activity increases,the total variable costs for the period

Semi-variable costs vary in direct proportion to the volume of activity.

Canine Cottage Industries makes several specially designed doghouses.The Standard Cost Card for The Gables model is shown.A customer ordered three of this model for their Labrador retrievers.The Job Cost Sheet is shown. From the information given for Canine Cottage Industries,compute the labor total,time and rate variances.

In a factory,the total variable costs are $600 if 500 units are produced.If 800 units are produced,the variable cost per unit would be

If a price variance for materials is unfavorable,the quantity variance for materials also must be unfavorable.

The flexible budget usually shows

Costs that vary in some degree with the volume of activity,but not in direct proportion to it are called ____________________ costs.

If the actual cost of an item is lower than the standard cost,a(n)____________________ price variance will be recognized.

The general model for computing a price variance is:

A budget that shows expected costs at more than one level of activity is called a(n)____________________ budget.

A decrease in activity level will result in: