Answer the following questions using the information below:
These questions refer to flexible-budget variance formulas with the following descriptions
for the variables: A = Actual; B = Budgeted; P = Price; Q = Quantity.
23) Which variance is calculated using the formula (AQ - BQ) BP is the ________.
A) efficiency variance
B) price variance
C) total flexible-budget variance
D) spending variance
Answer:
A
Diff: 2

Objective:
5
AACSB:
Analytical thinking
24) Which variance is calculated by using the formula: (AP - BP) AQ is the ________.
B
Diff: 2

Objective:
5
AACSB:
Analytical thinking

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Chapter 11 / Exercise 11-34

**Managerial Accounting: The Cornerstone of Business Decision-Making**

Hansen/Mowen

Expert Verified

25) The flexible-budget variance for materials is $2,000 (U). The sales-volume variance is
$18,000 (U). The price variance for material is $38,000 (F). The efficiency variance for
direct manufacturing labor is $12,000 (F). Calculate the efficiency variance for materials.
D
Diff: 3

Objective:
5
AACSB:
Application of knowledge
26) Which of the following is the correct formula for the materials price variance?
C
Diff: 2

Objective:
4
AACSB:
Analytical thinking
27) A company purchases $650,000 of materials on credit.
The standard cost for the
materials is
$675,000.
Which of the following would be the correct journal entries to
record the purchase under a standard costing system?
A) Direct Materials Control $675,000
Direct Materials Price Variance
$25,000
Accounts Payable Control
$650,000
B) WIP Control
$675,000
Direct Materials Price Variance
$25,000
Accounts Payable Control
$650,000
C) Accounts Payable Control
$650,000
Direct Materials Price Variance
$25,000
Direct Materials Control
$675,000
D) Accounts Payable Control
$650,000
Direct Materials Price Variance
$25,000
WIP Control
$675,000
Answer:
A
Diff: 1

Objective:
5
AACSB:
Analytical thinking

28) These questions refer to flexible-budget variance formulas with the following
descriptions for the variables: A = Actual; B = Budgeted; P = Price; Q = Quantity.
The best
label for the formula [(AP)(AQ) - (BP)(BQ)] is the ________.
C
Diff: 2

Objective:
5
AACSB:
Analytical thinking