Question Details

A company uses the following standard costs 



1. A company uses the following standard costs to produce a single unit of

Direct materials	6 pounds at $0.90 per pound = $5.40
Direct labor	0.5 hour at $ 12.00 per hour = $ 6.00
Manufacturing overhead	0.5 hour at $ 4.80 per hour = $ 2.40

output.
During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of
$1.00 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $56,350 based
on 4,900 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $15,000
and fixed manufacturing overhead incurred was $10,400. Based on this information, the direct labor rate
variance for the month was:
A. $1,200 favorable
B. $3,650 favorable
C. $2,450 favorable
D. $3,650 unfavorable
E. $1,200 unfavorable
2. A company uses the following standard costs to produce a single unit of

Direct materials	6 pounds at $0.90 per pound = $5.40
Direct labor	0.5 hour at $ 12.00 per hour = $ 6.00
Manufacturing overhead	0.5 hour at $ 4.80 per hour = $ 2.40

output.
During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of
$1.00 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $56,350 based
on 4,900 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $15,000
and fixed manufacturing overhead incurred was $10,400. Based on this information, the direct labor
efficiency variance for the month was:
A. $3,650 favorable
B. $2,450 favorable
C. $1,200 unfavorable
D. $1,200 favorable
E. $2,450 unfavorable
3. Overhead cost variance is:
A.
The difference between the overhead costs actually incurred and the overhead budgeted at the actual
operating level.
B.
The difference between the actual overhead incurred during a period and the standard overhead
applied.
C.
The difference between actual and budgeted cost caused by the difference between the actual price per
unit and the budgeted price per unit.
D
.
The costs that should be incurred under normal conditions to produce a specific product (or
component) or to perform a specific service.
E.
The difference between the total overhead cost that would have been expected if the actual operating
volume had been accurately predicted and the amount of overhead cost that was allocated to products
using the standard overhead rate.
4. The sum of the variable overhead spending variance, the variable overhead efficiency variance, and the
fixed overhead spending variance is the:
A. Production variance.
B. Quantity variance.
C. Volume variance.
D. Price variance.
E. Controllable variance.
5. The difference between the total budgeted fixed overhead cost and the fixed overhead applied to
production using the predetermined overhead rate is the:
A. Production variance.
B. Volume variance.
C. Overhead cost variance.
D. Quantity variance.
E. Controllable variance.




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