Question

13)  

Standard costs are divided into which of the following components?

a.standard price and standard quantity

b.variance standard and quantity standard

c.materials standard and labor standard

d.standard quality and standard quantity

12)  

Myers Corporation has the following data related to direct materials costs for November: actual costs for 4,690 pounds of material at $5.10 and standard costs for 4,450 pounds of material at $6.40 per pound.

The direct materials quantity variance is

a.$1,536 unfavorable

b.$6,097 unfavorable

c.$1,536 favorable

d.$6,097 favorable

10)  

The standard price and quantity of direct materials are separated because

a.standard quantities change more frequently than standard prices

b.direct materials prices are controlled by the purchasing department and quantity used is controlled by the production department

c.standard prices are more difficult to estimate than standard quantities

d.GAAP and IFRS reporting requires separation

9)  

Blaser Corporation had $1,100,000 in invested assets, sales of $1,241,000, operating income amounting to $239,000 , and a desired minimum return on investment of 12%. The return on investment for Blaser Corporation is

Round the percentage to one decimal place.

a.26.1%

b.21.7%

c.15.4%

d.19.3%

Answer 1

1. Answer : Option A , Standard Price and Standard Quantity .

Explanation; Standard Cost are divided by using standard price and Standard Quantity.

2. Answer : Option A , $1,536 Unfavourable

Explanation;  

Direct Material Quantity Variance = (Actual Quantity - Standard Quantity ) × Standard Price = (4,690 - 4,450 ) × $6.40 = 1,536 Unfavourable

3. Answer : Option B , Direct Material Price are Controlled by the purchasing department and quantity used in controlled by the production department.

Explanation; Standard Price of direct materials are controlled by the purchasing department and price variance will reflect the efficiency of purchasing department. Direct Material Quantity is controlled by the production department and quantity variance this will reflect the efficiency of production department.

4. Answer : Option B , 21.7 %

Explanation;  

Rate of Return is the actual return received in an investment . Here Blaser Corporation invested $1,100,000 in asset and earned an income of $239,000. So the rate of return is ;

Rate of Return  = Income Received / Investment in Asset = $239,000 / $1,100,000 = 21.7%