Practice and Quiz Eight
1．Standards that do not allow for machine breakdowns or other work interruptions and that require peak efficiency at all times are known as:
A) budgeted standards.B) ideal standards.C) normal standards.D) practical standards.
2. The "standard quantity allowed" is computed by multiplying the:
A) actual input in units by the standard output allowed.
B) actual output in units by the standard input allowed.
C) actual output in units by the standard output allowed.
D) standard output in units by the standard input allowed.
3. Marseille Company, a clothing manufacturer, uses a standard costing system. Each unit of a finished product contains 2 yards of cloth. However, there is unavoidable waste of 25%, calculated on input quantities, when the cloth is cut for assembly. The cost of the cloth is $6 per yard. The standard direct material cost for cloth per unit of finished product is:
A) $9.60.B) $12.00.C) $14.00.D) $15.00.
4. Lotus Company employs a standard cost system in which direct materials inventory is carried at standard cost. Lotus has established the following standards for the prime costs of one unit of
During June, Lotus purchased 330,000 pounds of direct material at a total cost of $2,343,000. The total factory wages for June were $1,600,000, 90 percent of which were for direct labor. Lotus manufactured 25,000 units of product during June using 302,000 pounds of direct material and 64,000 direct labor hours. The price variance for the direct material acquired by the company during June is:
A) $30,200 favorable.B) $30,200 unfavorable.C) $33,000 favorable.D) $33,000 unfavorable.
5. Lotus Company employs a standard cost system in which direct materials inventory is carried at standard cost. Lotus has established the following standards for the prime costs of one unit of
During June, Lotus purchased 330,000 pounds of direct material at a total cost of $2,343,000. The total factory wages for June were $1,600,000, 90 percent of which were for direct labor. Lotus manufactured 25,000 units of product during June using 302,000 pounds of direct material and 64,000 direct labor hours. The direct material quantity variance for June is:
A) $14,000 favorable.B) $14,000 unfavorable.C) $14,200 favorable.D) $14,200 unfavorable.
6. Lotus Company employs a standard cost system in which direct materials inventory is carried at standard cost. Lotus has established the following standards for the prime costs of one unit of product:
total factory wages for June were $1,600,000, 90 percent of which were for direct labor. Lotus manufactured 25,000 units of product during June using 302,000 pounds of direct material and 64,000 direct labor hours. The direct labor rate variance for June is:
A) $32,000 favorable.B) $32,000 unfavorable.C) $192,000 favorable.D) $192,000 unfavorable.
7. Lotus Company employs a standard cost system in which direct materials inventory is carried at standard cost. Lotus has established the following standards for the prime costs of one unit of product:
total factory wages for June were $1,600,000, 90 percent of which were for direct labor. Lotus manufactured 25,000 units of product during June using 302,000 pounds of direct material and 64,000 direct labor hours. The direct labor efficiency variance for June is:
A) $22,000 favorable.B) $22,000 unfavorable.C) $22,500 favorable.D) $22,500 unfavorable.
8. Danzig Company maintains warehouses that stock items carried by its e-retailer clients. When one of Danzig' clients receives an order from an online customer, the order is forward to Danzig. Danzig then pulls the item from the warehouse, packs it and ships it to the customer. Danzig uses a predetermined variable overhead rate based on direct labor-hours. According to the company's records, 0.04 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $3.25 per direct-labor hour. During August, Danzig shipped 120,000 orders using 4,600 direct labor-hours. The company incurred a total of $14,720 in variable overhead costs. The variable overhead spending variance during August was:
A) $230 favorable.B) $230 unfavorable.C) $650 favorable.D) $650 unfavorable.
9. Ventolin Company employs a standard cost system in which direct materials inventory is carried at standard cost. Ventolin has established the following standards for the prime costs of one unit of product:
