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Exam 23: Evaluating Variances From Standard Costs

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Question 61

True/False

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If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual direct materials used are 800 units at $12, the direct materials quantity variance is $2,200 unfavorable.

A) True
B) False

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Question 62

Multiple Choice

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The direct materials price variance is the difference between the

A) actual costs and the actual quantity at the standard price
B) actual costs and standard costs
C) actual price and the standard price
D) actual quantity at the standard price and the standard costs

E) B) and D)
F) A) and C)

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Question 63

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Currently attainable standards do not allow for reasonable production difficulties.

Greyson Company produced 8,300 units of product that required 4.25 standard hours per unit. Determine the standard fixed overhead cost per unit at 27,000 hours, which is 100% of normal capacity, if the favorable fixed factory overhead volume variance is $14,895.

Standard costs should always be revised when they differ from actual costs.

If employees are given bonuses for exceeding normal standards, the standards may be very effective in motivating employees.

The following data are given for Zoyza Company: Overhead is applied on standard labor hours.​ -The fixed factory overhead volume variance is

The following data are given for Stringer Company: Overhead is applied on standard labor hours. -The direct materials price variance is

If the standard to produce a given amount of product is 600 direct labor hours at $15 and the actual direct labor incurred is 500 hours at $17, the direct labor time variance is $1,700 unfavorable.

The standard costs and actual costs for direct labor for the manufacture of 2,500 actual units of product are as follows: The direct labor rate variance is

Accounting systems that use standards for product costs are called budgeted cost systems.

Compute the standard cost for one pair of boots, based on the following standards for each pair of boots: Standard materials quantity: 1.25 yards of leather at $35.00 per yard Standard labor: 9 hours at $25.75 per hour Factory overhead: $1.75 per direct labor hour

​ *Actual hours are equal to standard hours for units produced.​ -Which of the following is the correct formula for the direct labor time variance in a service business?

The most effective means of presenting factory overhead cost variance data is through a flexible factory overhead budget.

If the actual direct labor hours spent producing a commodity differ from the standard hours, the variance is a _____ variance.

The following data relate to direct labor costs for March: Rate: standard, $12.00; actual, $12.25 Hours: standard, 18,500; actual, 17,955 Units of production: 9,450 -The direct labor rate variance is

If the standard to produce a given amount of product is 600 direct labor hours at $17 and the actual direct labor incurred is 500 hours at $15, the direct labor time variance is $1,500 unfavorable.

Myers Corporation has the following data related to direct materials costs for November: actual costs for 5,000 pounds of material at $4.50 and standard costs for 4,800 pounds of material at $5.10 per pound.​ The direct materials quantity variance is

Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows: Actual costs 1,550 lbs. at $9.10 Standard costs 1,600 lbs. at $9.00 Determine the direct materials (a) quantity variance, (b) price variance, and (c) total cost variance.

​ *Actual hours are equal to standard hours for units produced.​ -The fixed factory overhead volume variance is