39. Which one of the following is the difference between the actual direct labor hours worked
and the standard direct labor hours allowed for the units manufactured, multiplied by the
standard hourly wage rate per hour?
40. The
primary
purpose of calculating standard cost variances each period is:
41. A firm uses a Just-in-Time (JIT) inventory system and has an unfavorable selling price
variance for the period just ended. If the proportion of the total variable manufacturing costs to
total sales in both the flexible budget and the actual operating results is 70%:
42. The effect on sales, expenses, or operating income of changes in units sold is measured
by the:
43. The difference between actual and standard cost caused by the difference between the
actual number of resource-units used and the standard number of resource-units that should
have been used for the output of the period is called the:
44. Which of the following is not a plausible cause of a direct labor efficiency variance?
45. The direct materials usage ratio for a given period is:
46. A favorable cost variance of significant magnitude:
47. A flexible budget contains:
48. A favorable price variance for direct materials indicates that:
49. A manufacturer planned to use $82 of materials per unit produced, but in the most recent
period it actually used $80 of material per unit produced. During this same period, the company
planned to produce 1,200 units, but actually produced only 1,000 units. The flexible-budget
variance for materials is:
1. Variable cost flexible-budget variance = actual variable cost – FB variable cost
2. Actual variable cost = $80,000 (i.e., 1,000 units × $80/unit)
3. Flexible budget (FB) variable cost = 1,000 units × $82/unit = $82,000
4. FB variance = $80,000 – $82,000 = $2,000F
50. All of the following are limitations of short-term financial performance indicators except:
51. Flexible budgets and standard costs are useful for assessing:
52. For
operational control
, a management accounting system should include:
53. Which of the following is not considered a basic business process?
54. Which of the following is not an anticipated benefit of switching to a Just–in-Time (JIT)
production system?
55. Customer-response time (CRT) is usually defined as:
56. The term “processing cycle efficiency” (PCE):
57. Which of the following is not indicated as an advantage of using nonfinancial
performance measures, relative to financial performance measures, as part of an operational
control system?
58. Which of the following statements about processing cycle efficiency (PCE) is not true?
59. A flexible-budget variance for any fixed cost:
60. The total operating-income variance for any period:
61. Information concerning Johnston Co.’s direct materials costs is as follows:
Standard price per pound $6.45
Actual quantity purchased 2,850 pounds
Actual quantity used in production 2,750 pounds
Units of products manufactured 700
Materials purchase-price variance–favorable $855
Budget data for the period:
Units to manufacture 1,000
Units of direct materials 4,000 pounds
The actual purchase price per pound of direct materials (rounded to two decimal places) is:
62. Information concerning Johnston Co.’s direct materials costs is as follows:
Standard price per pound $6.45
Actual quantity purchased 2,850 pounds
Actual quantity used in production 2,750 pounds
Units of products manufactured 700
Materials purchase-price variance–favorable $855
Budget data for the period:
Units to manufacture 1,000
Units of direct materials 4,000 pounds
The direct materials usage variance for the period (rounded to two decimal places) is:
63. Norio Manufacturing uses powdered plastics (PPS) to manufacture a high-pressure
board used in a digital equipment product, Flex 10. Information concerning its operation in June is
as follows:
Budgeted units of Flex 10 for June 5,000
Budgeted usage of PPS 45,000 pounds
Number of units of Flex 10 manufactured 4,000
PPS purchased 43,200 pounds
PPS used 39,000 pounds
Total actual cost of PPS used $224,640
Direct materials usage variance—unfavorable $21,600
The actual purchase price per pound of PPS used (rounded to two decimal places) is:
64. Norio Manufacturing uses powdered plastics (PPS) to manufacture a high-pressure
board used in a digital equipment product, Flex 10. Information concerning its operation in June is
as follows:
Budgeted units of Flex 10 for June 5,000
Budgeted usage of PPS 45,000 pounds
Number of units of Flex 10 manufactured 4,000
PPS purchased 43,200 pounds
PPS used 39,000 pounds
Total actual cost of PPS used $224,640
Direct materials usage variance—unfavorable $21,600
The standard cost per pound of PPS (to two decimal places) is:
65. Norio Manufacturing uses powdered plastics (PPS) to manufacture a high-pressure
board used in a digital equipment product, Flex 10. Information concerning its operation in June is
as follows:
Budgeted units of Flex 10 for June 5,000
Budgeted usage of PPS 45,000 pounds
Number of units of Flex 10 manufactured 4,000
PPS purchased 43,200 pounds
PPS used 39,000 pounds
Total actual cost of PPS used $224,640
Direct materials usage variance—unfavorable $21,600
The direct materials purchase-price variance (rounded to a whole number) is:
66. Norio Manufacturing uses powdered plastics (PPS) to manufacture a high–pressure
board used in a digital equipment product, Flex 10. Information concerning its operation in June is
as follows:
Budgeted units of Flex 10 for June 5,000
Budgeted usage of PPS 45,000 pounds
Number of units of Flex 10 manufactured 4,000
PPS purchased 43,200 pounds
PPS used 39,000 pounds
Total actual cost of PPS used $224,640
Direct materials usage variance—unfavorable $21,600
The cost of PPS in the flexible budget for the number of units manufactured this period is:
67. Lucky Company’s direct labor information for the month of February is as follows:
Actual direct labor hours worked (AQ) 61,500
Standard direct labor hours allowed (SQ) 63,000
Total payroll for direct labor $774,900
Direct labor efficiency variance $18,000
The actual direct labor rate per hour (AP) for February was: