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1 | |
Which of the following statements is untrue regarding material standards
(Learning Objective 1 Ch 13) |
| | A) | Historically waste and reject allowances have been included in material standards |
| | B) | The standard material cost always allows for the best material available to avoid waste |
| | C) | Proponents of TQM argue that waste allowances should not be included in material standards |
| | D) | Including an allowance for waste can hide inefficiencies |
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2 | |
One of the following statements is untrue regarding labour standards
(Learning Objective 1 Ch 13) |
| | A) | The standard labour cost should not make an allowance for holidays |
| | B) | Pension and NIC costs should always be included |
| | C) | Sometimes an average wage rate is used for groups of workers |
| | D) | The standard cost should make allowance for meal breaks |
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3 | |
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The material price variance is
(Learning Objective 2 Ch 13) |
| | A) | £2,000 U |
| | B) | £2,000 F |
| | C) | £6,000 U |
| | D) | £6,000 F |
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4 | |
The material quantity variance is
(Learning Objective 2 Ch 13) |
| | A) | £1,000 F |
| | B) | £1,000 U |
| | C) | £5,000 F |
| | D) | £5,000 U |
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5 | |
Only one of the following is likely to be the reason behind the
material price variance in Q3
(Learning Objective 2 Ch 13) |
| | A) | More expensive materials were used |
| | B) | The material was used inefficiently |
| | C) | A different supplier was sourced for the material |
| | D) | More material was used than was budgeted for |
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6 | |
Only one of the following is likely to be the reason behind the material quantity variance in Q4
(Learning Objective 2 Ch 13) |
| | A) | More expensive materials were used |
| | B) | Inferior quality materials were used |
| | C) | The material was used inefficiently |
| | D) | The standard was out of date |
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7 | |
The labour rate variance is
(Learning Objective 3 Ch 13) |
| | A) | NIL |
| | B) | £2,000 F |
| | C) | £3,000 U |
| | D) | £3,000 F |
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8 | |
The labour efficiency variance is
(Learning Objective 3 Ch 13) |
| | A) | £4,500 U |
| | B) | £4,500 F |
| | C) | £1,500 U |
| | D) | £1,500 F |
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9 | |
Only one of the following is likely to be the reason behind the labour rate variance in Q7
(Learning Objective 3 Ch 13) |
| | A) | There was a strike |
| | B) | Less skilled operatives were used |
| | C) | An unexpected pay rise was given |
| | D) | There were interruptions to production |
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10 | |
Only one of the following is likely to be the reason behind the labour efficiency variance in Q8
(Learning Objective 3 Ch 13) |
| | A) | There were interruptions to production |
| | B) | More efficient working practices were used |
| | C) | There was a strike |
| | D) | More expensive, therefore easier to handle material, was used |
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11 | |
The variable overhead spending variance is
(Learning Objective 4 Ch 13) |
| | A) | NIL |
| | B) | £500U |
| | C) | £500 F |
| | D) | £1,000 U |
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12 | |
Only one of the following is likely to be the reason behind the variable overhead spending variance
(Learning Objective 4 Ch 13) |
| | A) | Less electricity was used as fewer units were made |
| | B) | More electricity was used as more units were made |
| | C) | There was an expected rise in electricity prices |
| | D) | Fewer units were made per hour |
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13 | |
The variable overhead efficiency variance is
(Learning Objective 4 Ch 13) |
| | A) | £500 U |
| | B) | NIL |
| | C) | £1,000 F |
| | D) | £500 F |
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14 | |
Only one of the following is likely to be the reason behind the variable overhead efficiency variance
(Learning Objective 4 Ch 13) |
| | A) | There were interruptions to production |
| | B) | More efficient working practices were used |
| | C) | There was a strike |
| | D) | More expensive, therefore easier to handle material, was used |
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15 | |
Which one of the following is not an aim of standard costing
(Learning Objective 5 Ch 13) |
| | A) | To find someone to blame |
| | B) | To investigate the cause of significant variances |
| | C) | To remedy problems |
| | D) | To try and ensure that it doesn’t happen again |
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16 | |
Three of the following four are potential problems caused by over zealous operation of standard costing. Which one is not?
(Learning Objective 5 Ch 13) |
| | A) | Speed of working to produce favourable labour efficiency variances may reduce product quality |
| | B) | Overemphasis on production to produce favourable fixed overhead variances may cause overstocking |
| | C) | Standards are normally incompatible with budgets |
| | D) | Attempts to buy cheaply to produce favourable material price variances may result in poorer quality materials |
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