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| 1 | |
What is a standard cost? |
| | A) | An estimated cost based on historical data |
| | B) | A budget for the production of one unit of product or service |
| | C) | An actual cost reduced to a practical level |
| | D) | All of the above |
| | E) | None of the above |
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| 2 | |
Which are the two methods used by managerial accountants to set cost standards? |
| | A) | Analysis of historical data and management by exception |
| | B) | Analysis of historical data and variance analysis |
| | C) | Task analysis and a statistical approach |
| | D) | Analysis of historical data and practical standards |
| | E) | Analysis of historical data and task analysis |
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| 3 | |
Which of the following statements is true? |
| | A) | Many managers and behavioral scientists believe that perfection standards encourage and motivate employees in positive ways. |
| | B) | There is disagreement among managers and behavioral scientists that perfection standards encourage and motivate employees in positive ways. |
| | C) | Most behavioral theorists believe that perfection standards encourage more positive and productive employee attitudes than do practical standards. |
| | D) | A perfection standard is one that can be attained under nearly all operating conditions |
| | E) | Both (B) and (C) are true. |
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| 4 | |
Consider the following: <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_4.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (22.0K)</a>]]>
Assuming the company purchased and used 12,000 units of direct material, which of the following statements is true? |
| | A) | The result of A minus B equals the direct-material price variance |
| | B) | The result of B minus C equals the direct-material quantity variance |
| | C) | The result of A minus C equals the total direct-material cost variance |
| | D) | All of the statements are true. |
| | E) | None of the statement is true |
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| 5 | |
Consider the following: <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_5.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (21.0K)</a>]]>
Which of the following statements is true? |
| | A) | The result of A minus B equals the direct-labor rate variance |
| | B) | The result of B minus C equals the direct-labor efficiency variance |
| | C) | The result of A minus C equals the total direct-labor cost variance |
| | D) | All of the statements are true. |
| | E) | None of the statements is true. |
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| 6 | |
Consider the following information: <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_6.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (11.0K)</a>]]>
Which of the following are the direct-labor rate variance and the direct-labor efficiency variance, respectively? |
| | A) | $7,500 favorable and $7,500 unfavorable |
| | B) | $7,750 unfavorable and $7,500 favorable |
| | C) | $7,750 favorable and $7,250 unfavorable |
| | D) | $7,500 favorable and $7,250 unfavorable |
| | E) | $7,500 favorable and $7,500 favorable |
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| 7 | |
Consider the following information: <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_7.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (11.0K)</a>]]>
What is the dollar amount of the Direct Labor Efficiency Variance? |
| | A) | $3,425 unfavorable |
| | B) | $4,225 favorable |
| | C) | $3,425 favorable |
| | D) | $4,225 unfavorable |
| | E) | None of the above |
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| 8 | |
The __________ variance may be expressed as: PQ(AP – SP): |
| | A) | Direct Material Price |
| | B) | Direct Material Sales Price |
| | C) | Direct Material Quantity |
| | D) | Direct Material Spoilage |
| | E) | None of the above |
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| 9 | |
A statistical control chart plots cost variances across time and compares them with a statistically determined critical value that triggers an investigation. Which of the following is false regarding this critical value? |
| | A) | It is a value determined by assuming that cost variances have a normal probability distribution with a mean of zero. |
| | B) | It is set at some multiple of the distribution's standard deviation. |
| | C) | The cost variance can be favorable or unfavorable to reach the critical value. |
| | D) | The critical value triggers an investigation. |
| | E) | The critical value is set at the mean (zero) on a statistical control chart. |
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| 10 | |
The purchase of lower than standard quality materials may result in which of the following? |
| | A) | An unfavorable direct-material quantity variance. |
| | B) | An unfavorable direct-labor efficiency variance. |
| | C) | A favorable direct-material price variance. |
| | D) | An unfavorable direct-labor rate variance. |
| | E) | All of the above. |
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| 11 | |
Consider the following journal entry to record the issuance of 10,000 units of raw material with a standard unit cost of $4 that actually cost $4.50 per unit. In answering this question, assume that the 10,000 units of raw material issued represent the standard quantity allowed for actual production (in other words, there is no direct material quantity variance). <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_11.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (7.0K)</a>]]>
What type of cost system is being used? |
| | A) | Normal-costing system |
| | B) | Product-costing system |
| | C) | Actual-costing system |
| | D) | Standard-costing system |
| | E) | None of the above |
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| 12 | |
Which of the following is not an advantage of standard costing? |
| | A) | It provides a basis for sensible cost comparisons. |
| | B) | It enables managers to employee management by exception. |
| | C) | Standards can be used on a long-term basis. |
| | D) | It provides a means of performance evaluation and employee rewards. |
| | E) | Motivating employees to adhere to standards. |
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| 13 | |
Lakeland manufacturing emphasizes customer satisfaction as a company objective. Because of this, Lakeland incorporates production and delivery performance measures in to its management team's year-end bonus calculation. On average, Lakeland incurs the following during the production process per batch: <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_13_14.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (16.0K)</a>]]>
What is Lakeland's manufacturing cycle efficiency? |
| | A) | 25% |
| | B) | 28.5% |
| | C) | 20% |
| | D) | 30% |
| | E) | None of the above |
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| 14 | |
Lakeland manufacturing emphasizes customer satisfaction as a company objective. Because of this, Lakeland incorporates production and delivery performance measures in to its management team's year-end bonus calculation. On average, Lakeland incurs the following during the production process per batch:<![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/9352606310/856415/ch10_13_14.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (16.0K)</a>]]> What is Lakeland's average value added time per batch? |
| | A) | 2 days |
| | B) | 7 days |
| | C) | 9 days |
| | D) | 10 days |
| | E) | None of the above |
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| 15 | |
Which of the following is not a perspective under the balanced scorecard? |
| | A) | Financial |
| | B) | Customer |
| | C) | Internal operations |
| | D) | Learning and Growth |
| | E) | Vendor |
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