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Exam 22: Performance Evaluation Using Variances From Standard Costs

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Question 41

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If a company records inventory purchases at standard cost and also records purchase price variances, prepare the journal entry for a purchase of widgets that were bought at $7.45 per unit and have a standard cost of $7.15. The total amount owed to the vendor for this purchase is $33,525.

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Question 42

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The variance from standard for factory overhead cost resulting from operating at a level above or below 100% of normal capacity is termed volume variance.

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Question 43

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The following data is given for the Stringer Company: Overhead is applied on standard labor hours. -The materials quantity variance is

A budget performance report compares actual results with the budgeted amounts and reports differences for possible investigation.

A company should only use nonfinancial performance measures when financial measures cannot be calculated.

The following data relate to direct labor costs for the current period: Standard costs 36,000 hours at $22.00 Actual costs 35,000 hours at $23.00 What is the direct labor time variance?

Compute the standard cost for one hat, based on the following standards for each hat:

The standard factory overhead rate is $10 per direct labor hour $8 for variable factory overhead and $2 for fixed factory overhead) based on 100% of normal capacity of 30,000 direct labor hours. The standard cost and the actual cost of factory overhead for the production of 5,000 units during May were as follows: -Assuming that the standard fixed overhead rate is based on full capacity, the cost of available but unused productive capacity is indicated by the

Jaxson Corporation has the following data related to direct labor costs for September: actual costs are 10,200 hours at $15.75 per hour and standard costs are 10,800 hours at $15.50 per hour. What is the direct labor time variance?

Calculate the direct materials price variance.

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12, the direct materials price variance was $800 favorable.

The variance from standard for factory overhead resulting from incurring a total amount of factory overhead cost that is greater or less than the amount budgeted for the level of operations achieved is termed controllable variance.

The following data is given for the Taylor Company: Overhead is applied based on standard labor hours. -Compute the direct materials price and quantity variances for Taylor Company.

Match the following formulas or descriptions with the term a-e) it defines. -Actual price - Standard price) × Actual quantity

The following data is given for the Zoyza Company: Overhead is applied on standard labor hours. -The fixed factory overhead controllable variance is

The standard factory overhead rate is $7.50 per machine hour $6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: -What is the amount of the fixed factory overhead volume variance?

A company records its inventory purchases at standard cost but also records purchase price variances. The company purchased 5,000 widgets at $8.00 each, and the standard cost for the widgets is $7.60. Which of the following would be included in the journal entry?

Match the following descriptions with the term a-e) it describes: -actual cost > standard cost at actual volumes

Titus Company purchased and used 650 pounds of tomatoes direct materials) to produce a taco sauce with a 635 pound standard direct materials requirement. The standard materials price is $22.40 per pound. The actual price of the tomatoes was $22.20 per pound. Prepare the journal entries to record 1) the purchase of the tomatoes and 2) the tomatoes entering production. Titus records standards and variances in the general ledger.

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12, the direct materials quantity variance was $1,000 unfavorable.