Accounting Quiz Week 7

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Acct Quiz week 7 1. Which of the following might cause a materials variance? Failing to take purchase discounts. Using a better grade of raw material. Changes in the market supply for the raw materials. All of the above. 2. What is the term that describes the rate companies frequently use to apply fixed overhead costs to units produced? Predetermined overhead rate. 3. Activity-based costing is commonly used with standard costing. Using more activity drivers increases the potential for managers to get much more information from activity-based costing than from the traditional approach. 4. What is the result of substituting computerized equipment for direct labor? Less direct labor and more manufacturing…show more content…
Refer to Java Gourmet Coffee. Calculate the direct materials efficiency variance.  5000 AP ́ AQ $0.55 ́ 210,000 = $115,500 SP ́ AQ $0.50 ́ 210,000 = $105,000 SP ́ SQ $0.50 ́ 200,000 = $100,000 SP ́ SQ $0.50 ́ 200,000 = $100,000 |_____$10,500 U _____|________ $5,000 U_____| Direct materials price variance = $10,500 U Direct materials efficiency variance = $5,000 U Total direct materials variance = $15,500 U 8. Refer to Java Gourmet Coffee. Calculate the flexible budget for direct materials. 100,000 SP ́ SQ = flexible budget for materials $0.50 ́ 200,000 = $100,000 9. Refer to Java Gourmet Coffee. Calculate the direct labor price variance. 11,000 AP ́ AQ $19.00 ́ 11,000 = $209,000 SP ́ AQ $20.00 ́ 11,000 = $220,000 SP ́ SQ $20.00 ́ (0.05 ́ 200,000) = $200,000 SP ́ SQ $20.00 ́ (0.05 ́ 200,000) = $200,000 |_____$11,000 F _____|________ $20,000 U_____| Direct labor price variance = $11,000 F Direct labor variance =

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