What are the basic objectives in the use of standard costs? What are the two variances between the actual cost and the standard cost for direct materials? Would the use of standards be appropriate in a nonmanufacturing setting, such as a fast-food restaurant? Why? Why not?

Q: When the quantity of materials purchased is not equal to the quantity of material used, most…

A: Standard costing means where standard is set for various cost element and actual cost is then…

Q: Do not use negative signs with any of your answers. Next to Materials Variances Actual cost: Split…

A: Introduction:- The following formulas used as follows under:- Actual cost     =AQ×AP Split cost…

Q: In a manufacturing environment, like the GM truck plant in Flint, who has primary responsibility for…

A: Sales Volume Variance is the difference between actual units and budgeted units sold which is…

Q: What distinction must be made when computing the materials price variance vs. the materials quantity…

A: The answer for the theory question on material price and quantity variances is discussed hereunder :…

Q: Mention some important factors that must be born in your mind while interpreting variances.

A: Variance analysis is defined as the quantitative investigation, which is also a difference between…

Q: Which of the following would be included in the cost of a product manufactured according to variable…

A: Variable costing: Variable costing is a method that considers only the variable cost and ignores all…

Q: Which of the following statements is false? (You may select more than one answer.)a. Activity-based…

A:

Q: If there is an unfavorable direct material usage variance due to the substandard quality of the raw…

A: Solution: If there is an unfavorable direct material usage variance due to the substandard quality…

Q: What are two ways of reducing the negative aspects associated with using absorption costing to…

A:

Q: ?What is the price variance of direct materials -1 .. - -- --. Wangsgard Manufacturing has the…

A: The Direct material price variance is the difference between the actual amount spent on direct…

Q: controllability principle

A: The controllability principle stipulates that the evaluation of a manager should be based only on…

Q: Which of the following is false about activity-based costing?   Implementing an activity-based…

A: Activity-Based Costing (ABC): Under activity-based costing the different cost is assigned to a…

Q: Lynx Corp. manufactures windows and doors. Lynx has been using a standard cost system that bases…

A: 1. List the types of variances that are recommended to company L.   Company L should calculate…

Q: Which one of the following is correct about variable costing systems? Select one: a. Normally result…

A: Variable costing is a concept used in the cost accounting system which excludes fixed manufacturing…

Q: Why should a standard cost that is higher than an actual cost be of concern to management? Utilize…

A: Solution Concept Standard cost               Standard cost means the cost that is expected to be…

Q: The standards for direct materials are made up of which of the following components? a.variance…

A: The question is multiple choice question. Required  Choose the Correct Option.

Q: Which of the following would not be a period cost? Group of answer choices Research and development…

A: Solution: Period cost is the cost that is expensed in the income statement and same is not…

Q: Lynx Corp. manufactures windows and doors. Lynx has been using a standard cost system that bases…

A: 1. L should calculate efficiency variances and cost variances for every kind of direct material…

Q: Which of the following statement is true under the Standared Costing System a. Standard cost is a…

A: Solution: Standard costing system is the system of cost estimation in the manufacturing process. It…

Q: Q.Explain in details with example:- Control and Cost Reduction are the two important factors by…

A: To earn a profit is the main goal of every business.

Q: Which of the following factors is NOT considered to have influenced the development of…

A: Activity-based costing is a method to allocate the overhead and indirect cost to products and…

Q: In your own words, explain the difference between absorption costing and variable costing methods.…

A: Absorption costing: Its also called as Full costing.

Q: When deciding whether to make or buy a component part, the most relevant consideration is often:…

A: “Make or Buy” refers to decision made by firm whether to manufacture that product within premises or…

Q: Under Standard Costing System, direct material price variance shall be appropriately computed using…

A: Standard costing means where standard is set for various cost element and actual cost is then…

Q: How can HEB grocery benchmarks be determined when evaluating variances from standard costs.

A: Variance of the standard cost is the difference between the standard cost and the actual cost.…

Q: The variable overhead spending variance has to do with the efficient use of The overhead items. All…

A: Variance: The difference between the actual cost or price and the budgeted (standard) cost or price…

Q: Compute the price and efficiency variances of direct materials and direct manufacturing

A: Standard costing  - This is the method of costing where standard is determined and then its compared…

Q: A favorable direct materials price variance and an unfavorable direct materials quantity variance…

A: Direct Material Price Variance = Actual Quantity Purchased x (Standard Price - Actual Price) If…

Q: Discuss standard costs and indicate how they can be used by management in planning and control.

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Which of the following statements is true with regard to activity-based costing?   Multiple Choice…

A: The overhead is applied to the production using various methods as traditional costing and activity…

Q: Which costing system would be more efficient when direct materials and direct labor costs are high,…

A: There are mainly two types costing method Traditional costing Activity based costing

Q: Which of the following option is correct regarding difference in activity-based costing when…

A: Simple costing and activity based costing does not yield in similar since the cost drivers will…

Q: If JIT manufacturing is used and each manufacturing cell produces a single product, which of the…

A: The costs incurred in the manufacturing process can be classified as direct or indirect cost. The…

Q: here should firms do most of their quality spending? Group of answer choices a. Inspection costs b.…

A: The firms do most of their quality spending in -

Q: n determining the standard factory overhead rate, which level of capacity is used? Select one:…

A: Variance:-It is a difference between what is set as standard and what is the actual output produced.…

Q: The materials cost variance report for Nickols Inc. indicates a large favorable materials price…

A: Material Price Variance Material Price variance is defined as the difference between Actual price…

Q: Briefly discuss two methods of reducing the undesirable incentives associated with the use of…

A: Use of absorption costing can lead to undesirable incentives when evaluating the performance of a…

Q: Which one of the following may account for an adverse labour efficiency variance? O a. Using higher…

A: Labor Efficiency is the productivity of the labor employed and measures whether the labor is able to…

Q: What effect, if any, would you expect purchasing poor-quality materials to have on direct labour…

A: Direct labor variance arises due to the differences in the actual and budgeted rates of wage or…

Q: Which of the following statements is true with regard to activity-based costing? Multiple Cholce…

A: Activity-based costing is a method of costing that identify activities in an business and assigns…

Q: Bill Wilson, the financial accountant at Robson Ltd is considering implementing a standard costing…

A: Standard Costing - It is the process of estimation of expenses of the production process. It is cost…

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.