Managerial Accounting Ch 11

The general model for calculating a price variance is:

The purchasing agent of the Clampett Company ordered materials of lower quality in an effort to economize on price and in response to the demands of the production manager due to a mistake in production scheduling. The materials were shipped by airfreight at a rate higher than that ordinarily charged for shipment by truck, resulting in an unfavorable materials price variance. The lower quality material proved to be unsuitable on the production line and resulted in excessive waste. In this situation, who should be held responsible for the materials price and quantity variances?

If the labor efficiency variance is unfavorable, then

An unfavorable direct labor efficiency variance could be caused by:

Which of the following statements concerning ideal standards is incorrect?

The standards that allow for no machine breakdowns or other work interruptions and that require peak efficiency at all times are referred to as:

Which of the following statements concerning practical standards is incorrect?

An unfavorable materials quantity variance indicates that:

The materials price variance should be computed:

A favorable materials price variance coupled with an unfavorable material usage variance would MOST likely result from:

A labor efficiency variance resulting from the use of poor quality materials should be charged to:

A favorable labor rate variance indicates that

If the actual labor hours worked exceed the standard labor hours allowed, what type of variance will occur?

Which of the following statements is true? An unfavorable materials price variance could have resulted from actions taken by the purchasing agent. An unfavorable materials usage variance could have resulted from actions taken by the production supervisor. An unfavorable labor usage variance could have resulted from actions taken by the personnel department. All of the above answers are correct.

Which manager is usually held responsible for materials price variances?

Which manager is usually held responsible for labor price variances?

Standards that do not allow for normal down time, waste of materials, or machine breakdowns are known as:

Standards that do allow for normal down time and can be achieved with reasonable amounts of effort are known as:

What is the result when the actual rate paid for labor is less than the standard rate?

Which of the following statements is incorrect regarding variable overhead variances?

Which of the following statements is correct?

The terms "standard quantity allowed" or "standard hours allowed" means:

Overhead is applied to work in process in a standard costing system by:

Rameriz Company erred in selecting a denominator activity and chose a much higher level than was realistic. This error would most likely result in a large:

When computing standard cost variances, the difference between actual and standard price multiplied by actual quantity yields a(n):

Which department should usually be held responsible for an unfavorable materials price variance?

Variable manufacturing overhead is applied to products on the basis of standard direct labor-hours. If the direct labor efficiency variance is unfavorable, the variable overhead efficiency variance will be:

The Porter Company has a standard cost system. In July the company purchased and used 22,500 pounds of direct material at an actual cost of $53,000; the materials quantity variance was $1,875 Unfavorable; and the standard quantity of materials allowed for July production was 21,750 pounds. The materials price variance for July was:

If variable overhead is applied on the basis of direct labor-hours and the variable overhead rate variance is favorable, then:

Which of the following represents value-added time in the manufacturing cycle?

The difference between actual materials cost per unit and the standard materials cost per unit multiplied by actual quantity used is known as a:

What is the result when the quantity of materials used is less than the standard quantity?

The economic impact of the inability to reach a target denominator level of activity would best be measured by: