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21.If they are to be useful to managers, variances should be reported: 
 

A. simultaneously to all managers within a week after the end of the month.

B. in dollar amounts as soon as all costs are known.

C. in physical terms or dollar amounts as promptly as feasible.

D. in physical terms and dollar amounts if the variance exceeds 10% of the budget.

22.What should the decision rule be to determine what budget variances to investigate? 
 

A. Investigate unfavorable variances only.

B. Investigate favorable variances only.

C. Investigate if the variance is significant.

D. Investigate all variances.

23.Which of the following variances is not determined during an overhead variance analysis? 
 

A. Volume variance.

B. Budget variance.

C. Spending variance.

D. Price variance.

24.The fixed manufacturing overhead variance caused by actual activity being different from the estimated activity used in calculating the predetermined overhead application rate is called the: 
 

A. spending variance.

B. budgetvariance.

C. efficiency variance.

D. volume variance.

25.The part of the variable overhead budget variance due to the difference between actual hours required and standard hours allowed for the work done is called the: 
 

A. variable overhead spending variance.

B. variable overhead budget variance.

C. variable overhead efficiency variance.

D. variable overhead volume variance.

26.The part of the variable overhead budget variance due to the difference between actual variable overhead cost and the standard cost allowed for the actual inputs used is called the: 
 

A. variable overhead spending variance.

B. variable overhead budget variance.

C. variable overhead efficiency variance.

D. variable overhead volume variance.

27.If the net variance of a business using standard costing is significant relevant to total production cost, the net variance should be: 
 

A. assigned to cost of goods sold.

B. allocated between WIP and FG inventories and cost of goods sold.

C. carried forward to the next accounting period.

D. None of these.

28.If the net of all variances is immaterial relative to the total production costs incurred during the period, the net variance is: 
 

A. treated as an adjustment to cost of goods sold.

B. ignored.

C. treated as an adjustment to work in process, finished goods, and cost of goods sold.

D. treated as an adjustment to manufacturing overhead.

29.The preferred format for a segmented income statement emphasizes: 
 

A. direct and common fixed costs.

B. variable and fixed costs.

C. operating expenses and fixed costs.

D. variable costs and operating expenses.

30.Which of the following is a true statement pertaining to segment income statements? 
 

A. Only present the individual segments' net income, not total company net income.

B. Only include variable costs.

C. Do not present a segment margin.

D. Do not include arbitrarily allocated common fixed expenses when calculating segment margin.

E. All of these.

15-1

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