The following question is taken from the December 2011 exam paper.The following-新东方在线职业题库

A company uses a standard absorption costing system. Last month budgeted production was 8,000 units and the standard fixed production overhead cost was $15 per unit. Actual production last month was 8,500 units and the actual fixed production overhead cost was $17 per unit.What was the total adverse fixed production overhead variance for last month?

A

$7,500

B

$16,000

C

$17,000

D

$24.500

A cost centre had an overhead absorption rate of $4.25 per machine hour, based on a budgeted activity level of 12,400 machine hours.In the period covered by the budget, actual machine hours worked were 2% more than the budgeted hours and the actual overhead expenditure incurred in the cost centre was $56,389.What was the total over or under absorption of overheads in the cost centre for the period?

A

$1,054 over absorbed

B

$2,635 under absorbed

C

$3,689 over absorbed

D

$3,689 under absorbed

Which of the following would help to explain a favourable direct labour efficiency variance?

(i) Employees were of a lower skill level than specified in the standard

(ii) Better quality material was easier to process

(iii) Suggestions for improved working methods were implemented during the period

A

(i), (ii) and (iii)

B

(i) and (ii) only

C

(ii) and (iii) only

D

(i) and(II) only

Which of the following statements is correct?

A

An adverse direct material cost variance will always be a combination of an adverse material price variance and an adverse material usage variance

B

An adverse direct material cost variance will always be a combination of an adverse material price variance and a favourable material usage variance

C

An adverse direct material cost variance can be a combination of a favourable material price variance and a favourable material usage variance

D

An adverse direct material cost variance can be a combination of a favourable material price variance and an adverse material usage variance

The following information relates to labour costs for the past month:

Budget Labour rate $10 per hour

Production time 15,000 hours

Time per unit 3 hours

Production units 5,000 units

Actual Wages paid $176,000

Production 5,500 units

Total hours worked 14,000 hours

There was no idle time.

What were the labour rate and efficiency variances?

A

Rate variance Efficiency variance

$26,000 Adverse $25,000 Favourable

B

Rate variance Efficiency variance

$26,000 Adverse $10,000 Favourable

C

Rate variance Efficiency variance

$36,000 Adverse $2,500 Favourable

D

Rate variance Efficiency variance

$36,000 Adverse $25,000 Favourable