Question :
63. If the actual amount of direct materials used in production : 1229639
63. If the actual amount of direct materials used in production was less than the standard amount allowed for units produced, there was:
A. A favorable materials price variance.
B. A favorable total materials variance.
C. A favorable materials quantity variance.
D. An unfavorable materials quantity variance.
64. Dawson Company has a union contract which calls for an 8% cost of living increase in the wages paid to all factory workers as of July 1 of the current year. This suggests that:
A. The labor rate variance for July will be unfavorable.
B. The labor rate variances during the first half of the current year have been favorable.
C. The standard labor cost per unit should be revised as of July 1.
D. The labor efficiency variance for July will be unfavorable.
65. A labor efficiency (usage) variance is most likely to occur if:
A. Employees are paid at an overtime wage rate.
B. Employees are inefficient and units must be reworked.
C. Labor cost per unit exceeds materials costs per unit.
D. Employee turnover rates are low.
66. If the hourly wage rate actually paid during January is higher than the standard rate, the result is:
A. An unfavorable labor rate variance.
B. A favorable labor rate variance.
C. An unfavorable labor efficiency variance.
D. A favorable total labor variance.
67. The calculation of the labor efficiency variance is:
A. Standard rate multiplied by (standard hours minus actual hours).
B. Standard hours multiplied by (standard rate minus actual rate).
C. Actual labor hours multiplied by (standard rate minus actual rate).
D. Actual rate multiplied by (standard hours minus actual hours).
68. Using more direct labor hours for units produced than the amount allowed by the standard results in:
A. An unfavorable total labor variance.
B. An unfavorable labor efficiency variance, regardless of the wage rate paid employees.
C. An unfavorable labor efficiency variance only if the wage rate is higher than standard cost allowed.
D. A favorable labor rate variance, because the hourly wage rate is automatically reduced when workers operate less efficiently.
69. A standard cost is the per unit cost incurred under:
A. Ideal operating conditions.
B. Perfect operating conditions.
C. Normal, but efficient operating conditions.
D. Minimally acceptable operating conditions.
70. If fewer units are produced than had been estimated when standard unit costs were determined, there would normally be:
A. A favorable labor efficiency (usage) variance.
B. An unfavorable overhead volume variance.
C. A favorable materials quantity variance.
D. An unfavorable overhead spending variance.
71. An unfavorable volume variance in a factory is generally:
A. The responsibility of the production manager.
B. Viewed as an idle capacity loss.
C. The result of actual volume exceeding normal volume.
D. Treated as part of the controllable factory overhead variance.
72. The Victor Corporation has been incurring favorable overhead volume variances in each of the last several months. These persistent favorable variances indicate:
A. Victor’s management is unusually efficient.
B. The overhead application rate should be revised upward.
C. Monthly output is consistently under budget.
D. Monthly output is consistently over that budgeted.
