Question

17. Planning to purchase purchase materials in bulk amounts will affect the standard price for direct Select one: True X False di amount of direct materials purchased is usually equal to the amount of direct materials used in production that period. Select one: a True False 19. In what terms are standard variable overhead application rates (SR) stated? a. Per dollar b. Per direct labor hour c. Per unit of product d. Per month 20. The formula (Actual Price - Standard Price X Actual Quantity] can be used to calculate which cost variance? a Variable overhead volume b. Labor efficiency c. Materials efficiency Materials price 21. A direct materials price variance is unfavorable if the price paid per unit is greater than the standard price per unit. Select one: aTrue b. False 22. A negative direct labor efficiency variance is considered favorable. Select one: a. True b. False 23. Reasons for using standard costing include: Select one: a. Comparing projected costs against actual costs b. Planning and budgeting purposes c. Setting prices in advance d. Identifying specific areas for process improvement e. All of the above

Answer 1

Answer

Question	Correct Option	Answer
21	a	TRUE
22	a	TRUE
23	e	All of the above

Explanation:

Question	Correct Option	Answer	Explanation:
21	a	TRUE	If the actual price is more than the standard price, it is unfavorable as the cost will increase.
22	a	TRUE	If the answer to cost variance s is negative, it is favorable. This is because, we take (Actual price - standard price) in the formula.
23	e	All of the above	Standard cost helps us in all of the 4 ways.

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