Variances indicate

a. the cause of the variance.
b. who is responsible for the variance.
c. that actual performance is not going according to plan.
d. when the variance should be investigated.

ANS:  C                   

     2.   The unit standard cost is

a. the product of the standard price times the standard quantity for each unit
b. the price standard for each unit
c. the actual cost for a standard product
d. the amount of actual cost to produce a unit in a standardized process

ANS:  A                   

     3.   In setting price standards, the purchasing manager must consider

a. freight.
b. quality.
c. quantity discounts.
d. all of the above.

ANS:  D                   

     4.   _______________ demand maximum efficiency and can be achieved only if everything operates perfectly.

a. Currently attainable standards
b. Ideal standards
c. Budget standards
d. Personnel standards

ANS:  B                   

     5.   All of the following are true of currently attainable standards EXCEPT

a. Currently attainable standards are based on an efficiently operating work force.
b. Currently attainable standards are based on ideal conditions.
c. Currently attainable standards allow for downtime and rest periods.
d. Currently attainable standards are based on present production processes and technology.

ANS:  B                  

     6.   Price standards are the responsibility of

a. accounting.
b. purchasing.
c. personnel.
d. all of the above.

ANS:  D                   

     7.   Which of the following is NOT true about Kaizen Standards?

a. Kaizen standards are the standards used for continuous improvement.
b. Kaizen standards are a currently attainable standard that reflects planned improvement.
c. Kaizen standards are constantly changing.
d. Kaizen standards are the standards used in traditional costing systems.

ANS:  D                   

     8.   Quantity price standards:

a. standard price multiplied by standard quantity
b. specify how much of the quantity of input should be used for the standard price
c. specify how much should be paid for the quantity of input to be used
d. specify how much of the quantity of input should be used for the actual price

ANS:  C                   

     9.   The standard cost sheet includes all of the following EXCEPT

a. the standard quantity per unit.
b. the standard material costs per unit.
c. the standard cost per unit.
d. the standard labor hours allowed for actual production.

ANS:  D                   

   10.   Standard costing:

a. establishes price and quantity standards for inputs
b. provides journal entry support
c. is not used in unit costing
d. none of the above

ANS:  A                   

   11.   The standard cost sheet includes all of the following EXCEPT

a. the standard cost per unit.
b. the standard quantity allowed for actual production.
c. the standard price.
d. the standard quantity per unit.

ANS:  B                   

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