11.

Which of the following is the predetermined cost that can be used in the
calculation of a variance?
a.Product cost
b.Actual cost
c.Standard cost
d.Differential cost
ANSWER: D

12. Variances are computed by taking the difference between which of the following?
a.Product cost and period cost
b.Actual cost and rate factors
c.Price factors and rate factors
d.Actual cost and standard cost
ANSWER: D

13. Which of the following individual in the setting of either direct material standards
or direct labor standards?
a.The purchasing manager
b.A production supervisor
c.An engineer
d.A company’s president
ANSWER: D

14. Which of the following would be considered if a company desires to establish a

series of practical manufacturing standards?
a.Production time lost during unusual machinery breakdowns
b.normal defect rate in an assembly process
c.highly unusual spoilage rates with direct materials
d.Quantity discounts associated with purchases of direct materials
e.Both B and D
ANSWER: D

15. Which of the following correctly lists all the information needed to calculate a
labor rate variance?
a.Standard labor rate and actual hour worked
b.Standard labor rate, actual labor rate and actual hour worked
c.Actual labor rate, standard labor rate and actual hours worked
d.Actual labor rate, standard labor and actual hours worked
ANSWER: D