The difference between standard and actual cost per unit of input is measured by:
the raw materials price variance.
the direct labor rate variance.
the variable overhead spending variance.
all of the above.
If the net variance of a business using standard costing is significant relevant to total production cost, the net variance should be:
assigned to cost of goods sold.
allocated between work in process, finished goods, and cost of goods sold.
carried forward to the next accounting period.
none of the above.
The total variance for any particular cost component is referred to as the:
none of the above.
_____________ allows managers to focus their attention on maximizing an amount of earnings above a minimum required ROI.
The DuPont model
A set of integrated financial and operating performance measures that communicate an organization’s priorities associated with achieving strategic goals is known as a:
The total budget variance is caused by two factors:
quantity and price.
time and materials.
direct and indirect relationships.
fixed and variable cost behavior.
The preferred format for a segmented income statement emphasizes:
direct and common fixed costs.
variable and fixed costs.
operating expenses and fixed costs.
variable costs and operating expenses.
If the net of all variances is immaterial relative to the total production costs incurred during the period, the net variance is:
treated as an adjustment to cost of goods sold.
treated as an adjustment to work in process, finished goods, and cost of goods sold.
treated as an adjustment to manufacturing overhead.
Which of the following variances is not determined during an overhead variance analysis?
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:
The term noncontrollable cost:
implies that there is really nothing the manager can do to influence the amount of cost.
only applies to long-term costs.
never applies to short-term costs.
is another term for discretionary cost.
An example of a cost that is noncontrollable in the short run is:
The term transfer price refers to:
The price at which a product or service is sold to a government entity.
The price at which a product or service is sold by one segment to another related segment.
The price at which a product or service is sold by a segment to an outside party.
None of the above.
The principal objective of a performance report is to:
highlight activities that need management’s attention.
direct blame to those managers who did not meet goals.
provide a basis for rewarding effective managers.
highlight budgets that have been incorrectly established.
How is performance evaluated for a profit center?
Actual costs incurred compared to budgeted costs.
Actual segment margin compared to budgeted segment margin.
Comparison of actual and budgeted return on investment (ROI) based on segment margin and assets controlled by the segment.
None of the above.
________________ is a technique used to filter cost information contained in performance reports to each manager within the organization at an appropriate level of detail or summarization.
A budget adjusted to reflect a budget allowance based on actual activity achieved rather than the planned level of activity in the original budget is a:
April Corporation developed the following per-unit standards for its product: 2 pounds of direct materials at $3.75 per pound. Last month, 2,000 pounds of direct materials were purchased for $7,600. The direct materials price variance for last month was:
If they are to be useful to managers, variances should be reported:
simultaneously to all managers within a week after the end of the month.
in dollar amounts as soon as all costs are known.
in physical terms or dollar amounts as promptly as feasible.
in physical terms and dollar amounts if the variance exceeds 10% of the budget.
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:
variable overhead spending variance.
variable overhead budget variance.
variable overhead efficiency variance.
variable overhead volume variance.