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STANDARD COSTS mcq homework

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Question;61. Most;companies that use standards set them at;a. the;normal level.;b. a;conceivable level.;c. the;ideal level.;d. last;year's level.;62. A managerial accountant;1. does;not participate in the standard setting process.;2. provides;knowledge of cost behaviors in the standard setting process.;3. provides;input of historical costs to the standard setting process.;a. 1;b. 2;c. 3;d. 2;and 3;63. The cost of freight-in;a. is;to be included in the standard cost of direct materials.;b. is;considered a selling expense.;c. should;have a separate standard apart from direct materials.;d. should;not be included in a standard cost system.;64. The direct materials quantity standard;would not be expressed in;a. pounds.;b. barrels.;c. dollars.;d. board;feet.;65. The direct materials quantity standard;should;a. exclude;unavoidable waste.;b. exclude;quality considerations.;c. allow;for normal spoilage.;d. always;be expressed as an ideal standard.;66. The direct labor quantity standard is;sometimes called the direct labor;a. volume;standard.;b. effectiveness;standard.;c. efficiency;standard.;d. quality;standard.;67. A manufacturing company would include setup;and downtime in their direct;a. materials;price standard.;b. materials;quantity standard.;c. labor;price standard.;d. labor;quantity standard.;68. Allowance for spoilage is part of the;direct;a. materials;price standard.;b. materials;quantity standard.;c. labor;price standard.;d. labor;quantity standard.;69. The total standard cost to produce one unit;of product is shown;a. at;the bottom of the income statement.;b. at;the bottom of the balance sheet.;c. on;the standard cost card.;d. in;the Work in Process Inventory account.;70. An unfavorable materials quantity variance;would occur if;a. more;materials were purchased than were used.;b. actual;pounds of materials used were less than the standard pounds allowed.;c. actual;labor hours used were greater than the standard labor hours allowed.;d. actual;pounds of materials used were greater than the standard pounds allowed.;71. Oxnard Industries produces a product that;requires 2.6 pounds of materials per unit. The allowance for waste and spoilage;per unit is.3 pounds and.1 pounds, respectively. The purchase price is $2 per;pound, but a 2% discount is usually taken. Freight costs are $.10 per pound;and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00;per hour, but a raise which will average $.30 will go into effect soon. Payroll;taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard;production time is 1 hour per unit, and the allowance for rest periods and;setup is.2 hours and.1 hours, respectively. The standard direct materials;price per pound is;a. $1.96.;b. $2.00.;c. $2.13;d. $2.17;72. Oxnard Industries produces a product that;requires 2.6 pounds of materials per unit. The allowance for waste and spoilage;per unit is.3 pounds and.1 pounds, respectively. The purchase price is $2 per;pound, but a 2% discount is usually taken. Freight costs are $.10 per pound;and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00;per hour, but a raise which will average $.30 will go into effect soon. Payroll;taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard;production time is 1 hour per unit, and the allowance for rest periods and;setup is.2 hours and.1 hours, respectively. The standard direct materials;quantity per unit is;a. 2.6;pounds.;b. 2.7;pounds.;c. 2.9;pounds.;d. 3.0 pounds.;73. Oxnard Industries;produces a product that requires 2.6 pounds of materials per unit. The;allowance for waste and spoilage per unit is.3 pounds and.1 pounds;respectively. The purchase price is $2 per pound, but a 2% discount is usually;taken. Freight costs are $.10 per pound, and receiving and handling costs are;$.07 per pound. The hourly wage rate is $12.00 per hour, but a raise which will;average $.30 will go into effect soon. Payroll taxes are $1.20 per hour, and;fringe benefits average $2.40 per hour. Standard production time is 1 hour per;unit, and the allowance for rest periods and setup is.2 hours and.1 hours;respectively. The standard direct labor rate per hour is;a. $ 12.00.;b. $ 12.30.;c. $15.60.;d. $15.90.;74. Oxnard Industries produces a product that;requires 2.6 pounds of materials per unit. The allowance for waste and spoilage;per unit is.3 pounds and.1 pounds, respectively. The purchase price is $2 per;pound, but a 2% discount is usually taken. Freight costs are $.10 per pound;and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00;per hour, but a raise which will average $.30 will go into effect soon. Payroll;taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard;production time is 1 hour per unit, and the allowance for rest periods and;setup is.2 hours and.1 hours, respectively. The standard direct labor hours;per unit is;a. 1;hour.;b. 1.1;hours.;c. 1.2;hours.;d. 1.3 hours.;75. The standard direct materials quantity does not include allowances for;a. unavoidable;waste.;b. normal spoilage.;c. unexpected;spoilage.;d. all;of the above are included.;76. Allowances should not be made in the direct labor quantity standard for;a. wasted;time.;b. rest;periods.;c. cleanup.;d. machine;downtime.;77. The standard;predetermined overhead rate used in setting the standard overhead cost;is determined by dividing;a. budgeted overhead costs by an expected;standard activity index.;b. actual overhead costs by an expected;standard activity index.;c. budgeted overhead costs by actual activity.;d. actual overhead costs by actual activity.;78. Hofburg?s standard quantities for 1 unit of product include 2;pounds of materials and 1.5 labor hours. The standard rates are $2 per pound;and $7 per hour. The standard overhead rate is $8 per direct labor hour. The;total standard cost of Hofburg?s product is;a. $14.50.;b. $17.00.;c. $22.50.;d. $26.50.;79. Which of the following;statements is true?;a. Variances are the differences between;total actual costs and total standard costs.;b. When;actual costs exceed standard costs, the variance is favorable.;c. An;unfavorable variance results when actual costs are decreasing but standards are;not changed.;d. All of the above are true.;80. Unfavorable materials price and quantity variances are generally the;responsibility of the;Price Quantity;a. Purchasing department Purchasing Department;b. Purchasing department Production Department;c. Production;department Production;Department;d. Production Department Purchasing Department;81. Scorpion Production;Company planned to use 1 yard of plastic per unit budgeted at $81 a yard.;However, the plastic actually cost $80 per yard. The company actually made 3,900;units, although it had planned to make only 3,300 units. Total yards used for production;were 3,960. How much is the total materials variance?;a. $48,600;U;b. $4,860 U;c. $3,960;F;d. $900 U;82. If actual direct materials costs are;greater than standard direct materials costs, it means that;a. actual;costs were calculated incorrectly.;b. the;actual unit price of direct materials was greater than the standard unit price;of direct materials.;c. the;actual unit price of raw materials or the actual quantities of raw materials;used was greater than the standard unit price or standard quantities of raw;materials expected.;d. the;purchasing agent or the production foreman is inefficient.;83. If actual costs are greater than standard;costs, there is a(n);a. normal;variance.;b. unfavorable;variance.;c. favorable;variance.;d. error;in the accounting system.;84. A total materials variance is analyzed in;terms of;a. price;and quantity variances.;b. buy;and sell variances.;c. quantity;and quality variances.;d. tight;and loose variances.;85. A company developed the following per-unit;standards for its product: 2 pounds of direct materials at $4 per pound. Last;month, 1,500 pounds of direct materials were purchased for $5,700. The direct;materials price variance for last month was;a. $5,700;favorable.;b. $300;favorable.;c. $150;favorable.;d. $300;unfavorable.;86. The per-unit standards for direct materials;are 2 gallons at $4 per gallon. Last month, 11,200 gallons of direct materials;that actually cost $42,400 were used to produce 6,000 units of product. The;direct materials quantity variance for last month was;a. $3,200;favorable.;b. $2,400;favorable.;c. $3,200;unfavorable.;d. $5,600;unfavorable.;87. The purchasing;agent of the Poplin, Inc. ordered materials of lower quality in an effort to;economize on price. What variance will most likely result?;a. Favorable;materials quantity variance;b. Favorable;total materials variance;c. Unfavorable;materials price variance;d. Unfavorable laborquantity variance;88. The per-unit standards for direct labor are;2 direct labor hours at $15 per hour. If in producing 1,800 units, the actual;direct labor cost was $48,000 for 3,000 direct labor hours worked, the total;direct labor variance is;a. $1,800;unfavorable.;b. $6,000;favorable.;c. $3,750;unfavorable.;d. $6,000;unfavorable.;89. The standard rate of pay is $20 per direct;labor hour. If the actual direct labor payroll was $117,600 for 6,000 direct;labor hours worked, the direct labor price (rate) variance is;a. $2,400;unfavorable.;b. $2,400;favorable.;c. $3,000;unfavorable.;d. $3,000;favorable.;90. The standard number of hours that should;have been worked for the output attained is 6,000 direct labor hours and the;actual number of direct labor hours worked was 6,300. If the direct labor price;variance was $3,150 unfavorable, and the standard rate of pay was $9 per direct;labor hour, what was the actual rate of pay for direct labor?;a. $8.50;per direct labor hour;b. $7.50;per direct labor hour;c. $9.50;per direct labor hour;d. $9.00;per direct labor hour;91. Which one of the;following statements is true?;a. If;the materials price variance is unfavorable, then the materials;quantity variance must also be unfavorable.;b. If;the materials price variance is unfavorable, then the materials;quantity variance must be favorable.;c. Price;and quantity variances move in the same direction. If one is;favorable, the others will be as well.;d. There;is no correlation of favorable or unfavorable for price and;quantity variances.;92. Variances from standards are;a. expressed;in total dollars.;b. expressed;on a per-unit basis.;c. expressed;on a percentage basis.;d. all;of these.;93. A favorable variance;a. is;an indication that the company is not operating in an optimal manner.;b. implies;a positive result if quality control standards are met.;c. implies;a positive result if standards are flexible.;d. means;that standards are too loosely specified.;94. The total materials variance is equal to;the;a. materials;price variance.;b. difference;between the materials price variance and materials quantity variance.;c. product;of the materials price variance and the materials quantity variance.;d. sum;of the materials price variance and the materials quantity variance.;95. Information on Jayhawk's direct labor costs;for the month of August is as follows;Actual rate $10;Standard;hours 11,000;Actual hours;10,000;Direct labor;price variance?unfavorable $4,000;What was the;standard rate for August?;a. $9.96 c. $10.40;b. $9.60 d. $10.04;96. The total variance is $35,000. The total materials;variance is $14,000. The total labor variance is twice the total overhead;variance. What is the total overhead variance?;a. $3,500;b. $7,000;c. $10,500;d. $14,000;97. The formula for the materials price;variance is;a. (AQ;? SP) ? (SQ ? SP).;b. (AQ;? AP) ? (AQ ? SP).;c. (AQ;? AP) ? (SQ ? SP).;d. (AQ;? SP) ? (SQ ? AP).;98. The formula for the materials quantity;variance is;a. (SQ;? AP) ? (SQ ? SP).;b. (AQ;? AP) ? (AQ ? SP).;c. (AQ;? SP) ? (SQ ? SP).;d. (AQ;? AP) ? (SQ ? SP).;99. A company uses 8,400 pounds of materials;and exceeds the standard by 300 pounds. The quantity variance is $1,800 unfavorable.;What is the standard price?;a. $2;b. $4;c. $6;d. Cannot;be determined from the data provided.;100. A company purchases 20,000 pounds of;materials. The materials price variance is $4,000 favorable. What is the;difference between the standard and actual price paid for the materials?;a. $1.00;b. $0.20;c. $5.00;d. Cannot;be determined from the data provided.

 

Paper#41720 | Written in 18-Jul-2015

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