Review Problems-final exam 2007 (1)

Review Problems-final exam 2007 (1) - ACC256 Review for...

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ACC256 - Review for Final Comprehensive Multiple Choice 1. 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. 2. 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. 3. The Reedy Company uses a standard costing system. The following data are available for November: Actual direct labor hours worked 5,800 hours Standard direct labor rate $9 per hour Labor rate variance $1,160 favorable The actual direct labor rate for November is: A. $9.20 B. $8.80 C. $8.90 D. $9.00 Use the following information for questions 4 & 5. Barrick Company has established a flexible budget for manufacturing overhead based on direct labor-hours. Total budgeted costs at 200,000 direct labor-hours are as follows: Variable costs (total): Packing supplies. ................. $120,000 Indirect labor. ....................... $180,000 Fixed costs (total): Utilities. ................................ $100,000 Rent. .................................... $ 40,000 Insurance. ............................ $ 20,000 4. At an activity level of 170,000 direct labor-hours, the flexible budget for factory overhead would show the budgeted amount for utilities as: A. $ 85,000. B. $140,000. C. $160,000. D. $100,000. 1
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5. If Barrick Company plans to operate at 190,000 direct labor-hours during the next period, the flexible budget would show indirect labor costs of: A. $171,000. B. $180,000. C. $114,000. D. $270,000. 6. Consider the following three statements: I. A profit center has control over both cost and revenues. II. An investment center has control over invested funds, but not over costs and revenues. III. A cost center has no control over sales. Which statement(s) are correct? A. Only I. B. Only II. C. Only I and II. D. Only I and III. 7. A good example of a common cost which normally could not be assigned to products on a segmented income statement except on an arbitrary basis would be: A. direct materials. B. the product manager’s salary.
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This note was uploaded on 06/04/2011 for the course ACCOUNTING 2156 taught by Professor Cheryl during the Spring '09 term at Central Community College.

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Review Problems-final exam 2007 (1) - ACC256 Review for...

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