Chapter 11 MC

# Chapter 11 MC - Chapter 11 Variance Analysis A Tool for...

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Chapter 11 Variance Analysis – A Tool for Cost Control and Performance Evaluation Multiple Choice 1. (LO 1 – Standard cost) Answer: B 2. (LO 2 – Flexible vs. static budgets) Answer: C 3. (LO 2 – Flexible budget: calculation of net income) Answer: D Flexible budget Actual Variance Sales (6,000 x \$30) \$180,000 \$180,000 --- Direct material 12,600 12,900 300 U [(6,000 x 1.4 lbs) x \$1.5] (given) Direct labor 189,000 178,350 10,650 F [(6,000 x 3) x \$10.5] (given) Net loss \$(21,600) \$(11,250) \$10,350F 4. (LO 3 – Flexible budget variance) Answer: C (see #3) 5. (LO 3 – Sales volume variance) Answer: C SVV = Sales volume variance SVV = (Actual – Budgeted sales volume) x (Budgeted contribution margin/ unit) SVV = (10,500 – 11,000) x (\$14.75 - \$3 - \$9) SVV = \$1,375

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6. (LO 4 – Sales price variance) Answer: C SPV = Sales price variance SPV = (Actual – Expected sales price) x Actual volume SPV = (\$14.75 - \$14.75) x 10,500 SPV = \$0 7. (LO 5 – Direct materials price variance) Answer:
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## This note was uploaded on 08/30/2011 for the course ART 3514 taught by Professor Dhbannan during the Summer '03 term at Virginia Tech.

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Chapter 11 MC - Chapter 11 Variance Analysis A Tool for...

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