ACC 211 Final Ch 10

Term
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Ideal standards:
a.allow for normal breakdowns.
b.offer the greatest behavioral benefits.
c.can be achieved under efficient operating standards.
d.demand maximum efficiency.
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Terms in this set (15)
Ideal standards:
a.allow for normal breakdowns.
b.offer the greatest behavioral benefits.
c.can be achieved under efficient operating standards.
d.demand maximum efficiency.
d.demand maximum efficiency.
Alpha Company manufactures vitamin capsules packed in containers of 50 capsules each. 9,000 containers are produced during the first week of September. The unit quantity standard for machine operators is 0.50 hours per container and the actual machine operator hours used were 0.30 per container. Compute the operator hours that should be used for the actual output of 9,000 containers.
a.5,625 hours
b.4,500 hours
c.3,375 hours
d.2,700 hours
b.4,500 hours

Standard Hours Allowed=Unit Labor Standard × Actual Output=0.50 × 9,000=4,500 hours
In a standard costing system, costs are assigned to products using quantity and price standards:
a.only for direct materials and overhead.
b.for direct materials, indirect labor, and overhead.
c.only for direct materials and direct labor.
d.for direct materials, direct labor, and overhead.
d.for direct materials, direct labor, and overhead.
The responsibility for deviations from planned usage of inputs tends to be located in:
a.the purchasing department.
b.the marketing department.
c.the administrative department.
d.the production department.
d.the production department.
A standard cost sheet:
a.provides production data to calculate unit cost.
b.indicates the hourly wages for labor.
c.is not needed in computerized manufacturing.
d.is used to evaluate managers.
a.provides production data to calculate unit cost.
Peridot Inc. manufactures cooking oil. The actual quantity of input used for the month of June was 500 liters. The actual price per liter of raw material was $3 per liter, while the standard price per liter was $2.00 per liter. Determine the material price variance of the month of June.
a.$250U
b.$500U
c.$250F
d.$500F
b.$500U

Price Variance = (Actual Price per Unit - Standard Price per Unit) × Actual Quantity of Input Used or Price Variance = (AP - SP) × AQ= ($3 - $2.00) × 500 liters= $500U
Identify the equation used to determine material price variance.
a.Material Price Variance = (Actual Price per Unit - Standard Price per Unit) × Standard Quantity of Input Allowed for the Actual Output
b.Material Price Variance = (Standard Price per Unit - Actual Price per Unit) × Standard Quantity of Input Allowed for the Actual Output
c.Material Price Variance = (Actual Price per Unit - Standard Price per Unit) × Actual Quantity of Input Used
d.Material Price Variance = (Standard Price per Unit - Actual Price per Unit) × Actual Quantity of Input Used
c.Material Price Variance = (Actual Price per Unit - Standard Price per Unit) × Actual Quantity of Input Used
The materials usage variance should be calculated:
a.based on the amount of materials used in production.
b.only when there is a negative variance involved.
c.based on the type of labor used.
d.based on the actual price per unit of material used.
Feedback Area
a.based on the amount of materials used in production.
Hexagon Inc. manufactures fruit juice. Hexagon had an unfavorable material price variance of $375. The actual quantity of raw material used was 1,500 kilograms and the standard price of raw material was $3 per kilograms. Calculate the actual price per kilogram of raw material.
a.$2.75 per kilogram
b.$3.25 per kilogram
c.$3.00 per kilogram
d.$2.00 per kilogram
b.$3.25 per kilogram

Materials Price Variance = (Actual Price - Standard Price) × Actual Quantity
$375 = (Actual Price - $3) × 1,500 kilograms
Actual Price (AP) = $3 + ($375 / 1,500) = $3.25 per kilogram
Which of the following equations is used to calculate fixed overhead volume variance?
a.Fixed Overhead Volume Variance = Actual Fixed Overhead - (Actual Hours Used for Production × Standard Fixed Overhead Rate)
b.Fixed Overhead Volume Variance = Budgeted Fixed Overhead - (Standard Hours × Standard Fixed Overhead Rate)
c.Fixed Overhead Volume Variance = Budgeted Fixed Overhead - (Actual Hours Used for Production × Standard Fixed Overhead Rate)
d.Fixed Overhead Volume Variance = Actual Fixed Overhead - (Standard Hours × Standard Fixed Overhead Rate)
b.Fixed Overhead Volume Variance = Budgeted Fixed Overhead - (Standard Hours × Standard Fixed Overhead Rate)
Moccasin Company manufactures a special spare part. Moccasin had an unfavorable variable overhead spending variance of $460 for the month of August. The actual variable overhead incurred for the month of August was $7,450, and the standard variable overhead rate was $5 per hour. Determine the actual direct labor hours worked in the month of August. a.1,674 hours b.1,398 hours c.1,306 hours d.1,582 hoursb.1,398 hours Variable Overhead Spending Variance = Actual Variable Overhead - (Actual Hours Worked × Standard Variable Overhead Rate) $460 = $7,450 - (Actual Hours Worked × $5 per hour) Actual Hours Worked (AH) = ($7,450 - $460) / 5 = 1,398 hoursThe variable overhead efficiency variance is directly related to: a.the direct labor rate variance. b.the direct labor capacity variance. c.the direct labor usage variance. d.the direct labor volume variance.c.the direct labor usage varianceGamma Inc. has the following data at the end of the month of October: Standard Labor Cost: $9,000 Labor Efficiency Variance: $560 Unfavorable Labor Rate Variance: $375 Unfavorable Which of the following is the journal entry passed to record both types of labor variances? a.Debit Accrued, 9,935 Credit Labor Efficiency Variance, 560 Credit Labor Rate Variance, 375 Credit Work in Process, 9,000 b.Debit Work in Process, 9,000 Debit Labor Efficiency Variance, 560 Credit Labor Rate Variance, 375 Credit Accrued Payroll, 9,185 c.Debit Work in Process, 9,000 Debit Labor Efficiency Variance, 560 Debit Labor Rate Variance, 375 Credit Accrued Payroll, 9,935 d.Debit Accrued Payroll, 8,815 Debit Labor Efficiency Variance, 560 Credit Labor Rate Variance, 375 Credit Accrued Payroll, 9,000c.Debit Work in Process, 9,000 Debit Labor Efficiency Variance, 560 Debit Labor Rate Variance, 375 Credit Accrued Payroll, 9,935 Work in Process9,000 Labor Efficiency Variance 560 Labor Rate Variance 375 Accrued Payroll 9,935Which of the following is true of labor variances? a.An unfavorable labor efficiency variance is debited to Accounts Payable. b.A favorable labor efficiency variance is debited to Finished Goods. c.An unfavorable labor rate variance is credited to Accrued Payroll. d.A favorable labor rate variance is credited to Work in Process.c.An unfavorable labor rate variance is credited to Accrued Payroll.Identify the journal entry passed to record the purchase of materials when an unfavorable material price variance exists. a.Debit Materials, Credit Accounts Payable and Material Price variance b.Debit Materials, Credit Work in Process and Material Price variance c.Debit Materials and Material Price Variance, Credit Accounts Payable d.Debit Materials and Material Price Variance, Credit Work in Processc.Debit Materials and Material Price Variance, Credit Accounts Payable MaterialsStandard Price (SP) × Actual Quantity (AQ) Materials Price Variance(Actual Price - Standard Price) × Actual Quantity Accounts Payable