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11.The total variance for any particular cost component is referred to as the: 
 

A. price variance.

B. efficiency variance.

C. budget variance.

D. none of these.

12.The total budget variance is caused by two factors: 
 

A. quantity and price.

B. time and materials.

C. direct and indirect relationships.

D. fixed and variable cost behavior.

13.A variance is the difference between actual costs and: 
 

A. selling price.

B. expected costs.

C. activity-based costs.

D. historical costs.

14.The difference between standard and actual cost per unit of input is measured by: 
 

A. the raw materials price variance.

B. the direct labor rate variance.

C. the variable overhead spending variance.

D. all of these.

15.When an income statement shows data for segments of the organization, and data for each segment are added together to get totals for the whole organization: 
 

A. all expenses should be allocated to the segments.

B. common fixed expenses should be allocated to the segments.

C. only direct revenues and direct expenses should be assigned to segments.

D. direct fixed expenses should be subtracted as one amount in the "total" column.

16.Val's travel budget for October was $720, based on her plan to drive 3,000 miles at a cost of $0.24 per mile. During October, she actually drove 2,800 miles at a total cost of $700. A flexed budget performance report would show a variance of: 
 

A. $50 F.

B. $20 F.

C. $28 U.

D. $30 U.

17.If it is to be most useful for control purposes, what variance should be reported to the supervisor responsible for the number of pounds of corn syrup used in the manufacture of a candy bar? 
 

A. Raw material price variance, expressed in cents per pound.

B. Raw material usage variance, expressed as a total cost for the month.

C. Raw material usage variance, expressed in total pounds for the month.

D. Raw material usage variance, expressed in total pounds for the week.

18.The purchasing agent of an organization acquired some raw materials at a bargain price, even though she knew that their quality was lower than that of the materials customarily used. This action resulted in a favorable raw materials purchase price variance that might very well have been more than offset by: 
 

A. an unfavorable raw materials usage variance.

B. a favorable direct labor efficiency variance.

C. an unfavorable variable overhead spending variance.

D. an unfavorable direct labor rate variance.

19.When an appropriately established and effective standard cost system is used to value inventory: 
 

A. cumulative variances are deferred.

B. a significant unfavorable net variance may be reported as an expense of the current period.

C. asignificant favorable net variance may be reported as an expense of the current period.

D. the explanatory notes to the financial statements will explain the disposition of the net variance.

20.A performance report for direct labor shows a variance between the budget and actual amounts. This difference is a: 
 

A. budget variance.

B. direct labor efficiency variance.

C. direct labor spending variance.

D. direct labor rate variance.

15-1

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