Correct answers will be available on Oct 14 at 11:59pm.

Score for this quiz: 54 out of 64
Submitted Oct 14 at 4:42pm
This attempt took 162 minutes.
 
Question 1
1 / 1 pts
1. The standards that allow for no machine breakdowns or other work interruptions and
that require peak
efficiency at all times are referred to as:
a. normal standards.
b. practical standards.
c. ideal standards.
d. budgeted standard
 
 
IncorrectQuestion 2
0 / 1 pts
2. If a company follows a practice of isolating variances at the earliest point in time,
what would be the
appropriate time to isolate and recognize a direct material price variance?
a. When material is issued.
b. When material is purchased.
c. When material is used in production.
d. When production is completed.
 
 
Question 3
1 / 1 pts
3. An unfavorable labor efficiency variance indicates that:
a. The actual labor rate was higher than the standard labor rate.
b. The labor rate variance must also be unfavorable.
c. Actual labor hours worked exceeded standard labor hours for the production level
achieved.
d. Overtime labor was used during the period.
 
 
Question 4
1 / 1 pts
4. A favorable labor rate variance indicates that
a. actual hours exceed standard hours.
b. standard hours exceed actual hours.
c. the actual rate exceeds the standard rate.
d. the standard rate exceeds the actual rate
 
Question 5
1 / 1 pts
5. Which of the following is the most probable reason a company would experience an
unfavorable labor rate
variance and a favorable labor efficiency variance?
a. The mix of workers assigned to the particular job was heavily weighted towards the
use of higher paid, experienced individuals.
b. The mix of workers assigned to the particular job was heavily weighted towards the
use of new relatively low paid, unskilled workers.
c. Because of the production schedule, workers from other production areas were
assigned to assist this
particular process.
d. Defective materials caused more labor to be used in order to produce a standard unit.
 
Question 6
1 / 1 pts
6. Which department is usually held responsible for an unfavorable materials quantity
variance?
a. Marketing
b. Purchasing
c. Engineering
d. Production
 
 
Question 7
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7. Ella Company planned to produce 3,000 units of its single product, Regie, during
November. The
standards for one unit of Regie specify six pounds of materials at P0.30 per pound.
Actual production in
November was 3,100 units of Regie. There was a favorable materials price variance of
P380 and an
unfavorable materials quantity variance of P120. Based on these variances, one could
conclude that:
a. more materials were purchased than were used.
b. more materials were used than were purchased.
c. the actual cost per pound for materials was less than the standard cost per pound.
d. the actual usage of materials was less than the standard allowed
 
Question 8
1 / 1 pts
8. MAAN Company purchased materials on account. The entry to record the purchase
of materials having a standard cost of P1.50 per pound from a supplier at P1.60 per
pound would include a:
a. credit to Raw Materials Inventory.
b. debit to Work in Process.
c. credit to Materials Price Variance.
d. debit to Materials Price Variance
 
IncorrectQuestion 9
0 / 1 pts
9. The terms "standard quantity allowed" or "standard hours allowed" mean:
a. the actual output in units multiplied by the standard output allowed.
b. the actual input in units multiplied by the standard output allowed.
c. the actual output in units multiplied by the standard input allowed.
d. the standard output in units multiplied by the standard input allowed

IncorrectQuestion 10
0 / 1 pts
10. ANAZEL Company's direct material costs for the month of January were as follows:
Actual quantity purchased ............. 18,000 kilograms
Actual unit purchase price ............ P 3.60 per kilogram
Materials price variance--unfavorable (based on purchases) .... P 3,600
Standard quantity allowed for actual production ............... 16,000 kilograms
Actual quantity used .................. 15,000 kilograms
For January there was a favorable direct material quantity variance of:
a. P3,360.
b. P3,375.
c. P3,400.
d. P3,800
A
 
 
Question 11
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11. Information on Fleming Company's direct material costs follows:
Actual amount of direct materials used ...... 20,000 pounds
Actual direct material costs ................ P40,000
Standard price of direct materials .......... P2.10 per pound
Direct material efficiency variance--favorable P3,000
What was the company's direct material price variance?
a. P1,000 favorable.
b. P1,000 unfavorable.
c. P2,000 favorable.
d. P2,000 unfavorable.
 
Question 12
1 / 1 pts
12. Last month 75,000 pounds of direct material were purchased and 71,000 pounds
were used. If the actual
purchase price per pound was P0.50 more than the standard purchase price per pound,
then the material
price variance was:
a. P2,000 F.
b. P37,500 F.
c. P37,500 U.
d. P35,500 U.
 
Question 13
1 / 1 pts
13. The FLIRTER Company uses standard costing. The following data are available for
October:
Actual quantity of direct materials used ... 23,500 pounds
Standard price of direct materials ......... P2 per pound
Material quantity variance ................. P1,000 favorable
The standard quantity of material allowed for October production is:
a. 23,000 lbs.
b. 24,000 lbs.
c. 24,500 lbs.
d. 25,000 lbs.

Question 14
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14. The following labor standards have been established for a particular product:
Standard labor hours per unit of output .. 8.3 hours
Standard labor rate ...................... P12.10 per hour
The following data pertain to operations concerning the product for the last month:
Actual hours worked ...................... 6,100 hours
Actual total labor cost .................. P71,370
Actual output ............................ 900 units
What is the labor efficiency variance for the month?
a. P19,017 F
b. P19,017 U
c. P16,029 F
d. P16,577 F
 
Question 15
1 / 1 pts
15. DI KA Lab Corp. uses a standard cost system. Direct labor information for Product
CER for the month of October follows:
Standard direct labor rate ................. P6.00 per hour
Actual direct labor rate paid .............. P6.10 per hour
Standard hours allowed for actual production 1,500 hours
Labor efficiency variance--unfavorable ..... P600
What are the actual hours worked?
a. 1,400.
b. 1,402.
c. 1,598.
d. 1,600
 
Question 16
1 / 1 pts
16. For the month of April, TORPE Co.'s records disclosed the following data relating to
direct labor:
Actual cost ............... P10,000
Rate variance ............. P 1,000 favorable
Efficiency variance ....... P 1,500 unfavorable
For the month of April, actual direct labor hours amounted to 2,000. In April, Thorp's
standard direct labor
rate per hour was:
a. P5.50.
b. P5.00.
c. P4.75.
d. P4.50
 
Question 17
1 / 1 pts
17. The following standards for variable manufacturing overhead have been established
for a company that
makes only one product:
Standard hours per unit of output ...... 7.8 hours
Standard variable overhead rate ........ P12.55 per hour
The following data pertain to operations for the last month:
Actual hours ........................... 2,900 hours
Actual total variable overhead cost .... P36,975
Actual output .......................... 200 units
What is the variable overhead efficiency variance for the month?
a. P17,397 U
b. P16,817 U
c. P312 F
d. P17,085 U

Question 18
1 / 1 pts
18. The following standards for variable manufacturing overhead have been established
for a company that
makes only one product:
Standard hours per unit of output ...... 5.6 hours
Standard variable overhead rate ........ P12.00 per hour
The following data pertain to operations for the last month:
Actual hours ........................... 2,600 hours
Actual total variable overhead cost .... P31,330
Actual output .......................... 400 units
What is the variable overhead spending variance for the month?
a. P112 F
b. P130 U
c. P4,450 U
d. P4,338 U

Question 19
1 / 1 pts
19. The RETARDED Company has established standards as follows:
Direct material 3 lbs. @ P4/lb. = P12 per unit
Direct labor 2 hrs. @ P8/hr. = P16 per unit
Variable manuf. overhead 2 hrs. @ P5/hr. = P10 per unit
Actual production figures for the past year are given below. The company records the
materials price variance when materials are purchased.
Units produced 600
Direct material used 2,000 lbs.
Direct material purchased (3,000 lbs.) P11,400
Direct labor cost (1,100 hrs.) P 9,240
Variable manuf. overhead cost incurred P 5,720
The company applies variable manufacturing overhead to products on the basis of
direct labor hours.
The materials price variance is:
a. P400 U.
b. P400 F.
c. P600 F.
d. P600 U.
 
Question 20
1 / 1 pts
20. REFER TO NO. 19. The materials quantity variance is:
a. P800 U.
b. P4,000 U.
c. P760 U.
d. P760 F.
 
Question 21
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21.  REFER TO NO. 19. The labor rate variance is:
a. P480 F.
b. P480 U.
c. P440 F.
d. P440 U.

Question 22
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22. REFER TO NO. 19. The labor efficiency variance is:
a. P800 F.
b. P800 U.
c. P840 F.
d. P840 U.
 
Question 23
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23. REFER TO NO. 19. The variable overhead spending variance is:
a. P240 U.
b. P220 U.
c. P220 F.
d. P240 F.
 
Question 24
1 / 1 pts
24. REFER TO NO. 19. The variable overhead efficiency variance is:
a. P520 F.
b. P520 U.
c. P500 U.
d. P500 F.
 
Question 25
1 / 1 pts
25. The LAKERS Company makes a single product and uses standard costing. Some
data concerning this product for the month of May
follow:
Labor rate variance:.................................. P 7,000 F
Labor efficiency variance:............................ P12,000 F
Variable overhead efficiency variance:................ P 4,000 F
Number of units produced:............................. 10,000
Standard labor rate per direct labor hour:............ P12
Standard variable overhead rate per direct labor hour: P 4
Actual labor hours used:.............................. 14,000
Actual variable manufacturing overhead costs:......... P58,290
The variable overhead spending variance for May was:
a. P2,290 F.
b. P2,290 U.
c. P1,710 F.
d. P1,710 U
 
Question 26
1 / 1 pts
26. SHANDREA Company employs a standard costing system in which variable
overhead is assigned to production on the basis of direct labor hours. Data for the
month of OCTOBER include the following:
• Variable manufacturing overhead cost incurred: P48,700
• Total variable overhead variance: P300 F
• Standard hours allowed for actual production: 7,000
• Actual direct labor hours worked: 6,840
The standard variable overhead rate per direct labor hour is:
a. P6.91.
b. P6.95.
c. P7.00.
d. P7.12.
 
IncorrectQuestion 27
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Questions 27 through 30 are based on the following information.
Standard costs and budgetary control methods must be closely related.  This
relationship is particularly applicable for factory overhead.  A flexible budget allows
better control over factory overhead than a fixed budget.  The flexible budget for Sta.
Maria Corporation is presented below:

  Percent of Normal Operating Capacity

  80% 90% 100%* 110%

VOH P  72,000 P  81,000 P  90,000 P  99,000

FxOH 45,000 45,000 45,000 45,000

 Total FOH P117,000 P126,000 P135,000 P144,000

* Normal capacity
In accordance with standards established, 90,000 units of product should be
manufactured when the company operates its normal capacity.  The standard labor time
per unit of product is 20 minutes.  Actual production in 2012 was 75,000 units of product
in 24,000 hours.
27. What is the standard variable factory overhead rate per hour?
a. 2.00                                  c.    P4.50
b. 1.00                                   d.    P3.00
 
IncorrectQuestion 28
0 / 1 pts
28. What is the budgeted factory overhead adjusted to standard hours allowed for units
actually produced?
a. P117,000                             c.    P135,000
b. P112,500                             d.    P120,000
 
IncorrectQuestion 29
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29. What is the budgeted factory overhead adjusted to actual hours worked.
a. P117,000                     c.    P135,000
b. P112,500                    d.    P120,000
 
Question 30
1 / 1 pts
30. What is the factory overhead applied to production (based on standard hours?
a. P117,000                    c.    P135,000
b. P112,500                    d.    P120,000

 
Question 31
1 / 1 pts
31. Which of the following is not an operating asset?
A. Cash
B. Inventory
C. Plant equipment
D. Common stock

Question 32
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32. In computing the margin in a ROI analysis, which of the following is used?
A. Sales in the denominator
B. Net operating income in the denominator
C. Average operating assets in the denominator
D. Residual income in the denominator
 
Question 33
1 / 1 pts
33. Residual income is a better measure for performance evaluation of an investment
center manager than return on investment because:
A. the problems associated with measuring the asset base are eliminated.
B. desirable investment decisions will not be rejected by divisions that already have a
high ROI.
C. only the gross book value of assets needs to be calculated.
D. returns do not increase as assets are depreciated.
 
Question 34
1 / 1 pts
34. All other things the same, which of the following would increase residual income?
A. Increase in average operating assets.
B. Decrease in average operating assets.
C. Increase in minimum required return.
D. Decrease in net operating income.
 
Question 35
1 / 1 pts
35. Which of the following three statements are correct?
I. A profit center has control over both cost and revenue.
II. An investment center has control over invested funds, but not over costs and
revenue.
III. A cost center has no control over sales.
A. Only I
B. Only II
C. Only I and III
D. Only I and II

Question 36
1 / 1 pts
36. The purpose of the Data Processing Department of Falena Corporation is to assist
the
various departments of the corporation with their information needs free of charge. The
Data
Processing Department would best be evaluated as a:
A. cost center.
B. revenue center.
C. profit center.
D. investment center
 
IncorrectQuestion 37
0 / 1 pts
37. Average operating assets are $110,000 and net operating income is $23,100. The
company
invests $25,000 in new assets for a project that will increase net operating income by
$4,750.
What is the return on investment (ROI) of the new project?
A. 21%
B. 19%
C. 18.5%
D. 20%
 
Question 38
1 / 1 pts
38. Last year a company had stockholder's equity of $160,000, net operating income of
$16,000 and sales of $100,000. The turnover was 0.5. The return on investment (ROI)
was:
A. 10%
B. 9%
C. 8%
D. 7%
 
Question 39
1 / 1 pts
39. JC Company's sales last year totaled $150,000 and its return on investment (ROI)
was 12%. If the company's turnover was 3, then its net operating income for the year
must have been:
A. $6,000
B. $2,000
C. $18,000
D. it is impossible to determine from the data given.
 
 
Question 40
1 / 1 pts
40. A company's current net operating income is $16,800 and its average operating
assets are $80,000. The company's required rate of return is 18%. A new project being
considered would require an investment of $15,000 and would generate annual net
operating income of $3,000. What is the residual income of the new project?
A. 20.8%
B. 20%
C. ($150)
D. $300
 
Question 41
1 / 1 pts
41. MY IU Corporation uses residual income to evaluate the performance of its
divisions. The company's minimum required rate of return is 11%. In April, the
Commercial Products Division had average operating assets of $100,000 and net
operating income of $9,400. What was the Commercial Products Division's residual
income in April?
A. -$1,600
B. $1,600
C. $1,034
D. -$1,034
 
Question 42
1 / 1 pts
42. Division MELMEL had an ROI last year of 15%. The division's minimum required
rate of return is 10%. If the division's average operating assets last year were $450,000,
then the division's residual income for last year was:
A. $67,500
B. $22,500
C. $37,500
D. $45,000
 
IncorrectQuestion 43
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43. The master budget is a.
a flexible budget
b. a static budget
c. developed at the end of the period
d. based on the actual level of output

Question 44
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44. Which of the following budgets allow for adjustments in activity levels?
A. Static Budget
B. Continuous Budget
C. Zero-Based Budget
D. Flexible Budget

Question 45
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45. Which of the following is incorrect?
A. Responsibility accounting is a system of accounting in which costs are assigned to
various managerial levels according to where control of the costs is deemed to rest, with
managers being held responsible for the difference between actual and budgeted
results
B. A direct labor budget is a detailed plan showing labor requirements over some
specific time period
C. A sales budget is a detailed schedule showing expected sales over some specified
time period
D. A production budget is a detailed plan showing the production costs, other than direct
materials and direct labor that will be incurred in attaining output budgeted for a period.
 
Question 46
1 / 1 pts
 46. 
              Sales                                                                                       P  1,500,000
               Gross profit (based on units)                                                        25%
               Decrease in inventories                                                    P       70,000
               Decrease in accounts payable for inventories                 P     120,000
For July 2014 what were the additional cash disbursements for inventories?          
a. P 935,000                                                           c.   P1,055,000
b. P1,050,000                                                        d.   P1,175,000

Question 47
1 / 1 pts
47. Sales projection for the year 2020 
              May                                      P100,000
               June                                        120,000
               July                                         140,000
               August                                    160,000
               October                                  130,000
 
Normal cash collection experience has been that 50% of sales is collected during the
month of sales is collected during the month of sale and 45% in the month following
sale. The remaining 5% of sales are never collected.  Delo’s budgeted cash collections
for the third calendar quarter are     (cma) 
a. P450,000                                 c. P440,000
b. P414,000                                 d. P360,000
 
Question 48
1 / 1 pts
48. Delta Corporation plans to sell 200,000 units of product Gulp in July and anticipated
a growth in sales of 5% per month.  The target ending inventory in units of the product is
80% of the next month’s estimated sales. There are 150,000 units in inventory as of the
end of June.  The production requirement in units of Gulp for the quarter ending
September 30 would be   
A. 670,560 units   
B. 691,525 units 
C. 665,720 units
D. 675,925 units
 
 
IncorrectQuestion 49
0 / 1 pts
49. Josefina Company expects to manufacture and sell 30,000 baskets in 2014 for P6
each. There are 3,000 baskets in beginning finished goods inventory with target ending
inventory of 4,000 baskets. The company keeps no work-in-process inventory.
a. P174,000                                        c.    P186,000
b. P180,000                                        d.    P204,000

  
Question 50
1 / 1 pts
50. Budgeted manufacturing overhead costs include all types of factory expenses
EXCEPT:
A) fixed items such as depreciation of manufacturing machinery
B) variable items such as plant supplies
C) indirect labor such as the salary of the plant supervisor
D) direct labor and direct materials

Question 51
1 / 1 pts
51. When using a flexible budget, a decrease in activity within the relevant range:
A) decreases variable cost per unit.
B) decreases total costs.
C) increases total fixed costs.
D) increases variable cost per unit.
 
Question 52
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52. A budget that is based on the actual activity of a period
is known as a:
A) continuous budget.
B) flexible budget.
C) static budget.
D) master budget.
 
Question 53
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53. The following costs appear in Malgorzata Company's flexible budget at an activity
level of 15,000 machine-hours:
Total Cost
Indirect materials............... $7,800
Factory rent........................ $18,000
What would be the flexible budget amounts at an activity level of 12,000 machine-hours
if indirect materials is a variable cost and factory rent is a fixed cost?
            Indirect Materials      Factory Rent
A)                   $7,800                  $14,400
B)                   $7,800                  $18,000
C)                   $6,240                  $14,400
D)                   $6,240                 $18,000
Question 54
1 / 1 pts
55. ANGELIKA Enterprise's flexible budget cost formula for indirect materials, a variable
cost, is $0.45 per unit of output. If the company's performance report for last month
shows a $90 favorable variance for indirect materials and if 8,700 units of output
were produced last month, then the actual costs incurred for indirect materials for the
month must have been:
A) $4,005
B) $3,915
C) $3,825
D) $3,735

IncorrectQuestion 55
0 / 1 pts
56. VON Installation Corporation measures its activity in terms of square feet of tile
installed. Last month, the budgeted level of activity was 1,630 square feet and the
actual level of activity was 1,720 square feet. The company's owner budgets for supply
costs, a variable overhead cost, at $3.40 per square foot. The actual supply cost last
month was $6,750. In the company's flexible budget performance report for last
month, what would have been the variance for supply costs?
A) $353 U
B) $306 U
C) $902 U
D) $1,208 U

Question 56
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Questions 57–59 are based on the following data:
Tee Times, Inc., produces and sells the finest quality golf clubs in all of Clay County.
The company expects the following revenues and costs in 2003 for its Elite Quality golf
club sets:
Revenues (400 sets sold @ $600 per set) $240,000
Variable costs 160,000
Fixed costs 50,000
57. How many sets of clubs must be sold for Tee Times, Inc., to reach their breakeven
point?
a. 400
b. 250
c. 200
d. 150
 
Question 57
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58. How many sets of clubs must be sold to earn a target operating income of $90,000?
a. 700
b. 500
c. 400
d. 300
 
Question 58
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59. What amount of sales must Tee Times, Inc., have to earn a target net income of
$63,000 if they have
a tax rate of 30%?
a. $489,000
b. $429,000
c. $420,000
d. $300,000

Question 59
1 / 1 pts
60. Contribution margin is calculated as
a. total revenue – total fixed costs.
b. total revenue – total manufacturing costs (CGS).
c. total revenue – total variable costs.
d. operating income + total variable costs

Question 60
1 / 1 pts
61. How would the following costs be classified (product or period) under variable
costing at a retail clothing store?
                     Cost of purchasing clothing                     Sales commissions
A)                                Product                                                      Product
B)                                Product                                                       Period
C)                                Period                                                          Product
D)                                Period                                                          Period
 
 
Question 61
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62. The costing method that treats all fixed costs as period costs is:
A) absorption costing.
B) job-order costing.
C) variable costing.
Question 62
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63. Shun Corporation manufactures and sells a hand held calculator. The
following information relates to Shun's operations for last year:
Unit product cost under variable costing......................... $5.20 per unit
Fixed manufacturing overhead cost for the year............. $260,000
Fixed selling and administrative cost for the year........... $180,000
Units (calculators) produced and sold............................. 400,000
What is Shun's unit product cost under absorption costing for last year?
A) $4.10
B) $4.55
C) $5.85
D) $6.30
 
Question 63
1 / 1 pts
64. Assuming actual factory overhead is P7,250; budgeted fixed overhead is P3,600;
variable overhead rate is P2.00 per hour and the standard hours in the product are
2,000 hours. The controllable variance is
a. UF at P3,250                                                         c.    F at P3,250
b. UF at P350                                                             d.    F at P350

Question 64
1 / 1 pts
65. REGLA Inc. had a P30,000 favourable fixed overhead budget variance, a P44,000
unfavourable variable overhead spending variance, and P44,000 total underapplied
overhead. The volume variance was
a. P58,000 overapplied.
b. P58,000 underapplied.
c. P30,000 overapplied.
d. P30,000 underapplied.