2 A production volume variance will exists when: Production volume differs from the sales volume. Actual direct labor hours differ from standard allowed direct labor hours The fixed overhead applied on the basis of standard allowed direct labor hours differs from actual fixed factory overhead. The fixed overhead applied on the basis of standard allowed direct labor hours differs from budgeted fixed factory overhead.

2 A production volume variance will exists when: Production volume differs from the sales volume. Actual direct labor hours differ from standard allowed direct labor hours The fixed overhead applied on the basis of standard allowed direct labor hours differs from actual fixed factory overhead. The fixed overhead applied on the basis of standard allowed direct labor hours differs from budgeted fixed factory overhead.

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Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 21MC: The fixed factory overhead variance is caused by the difference between which of the following? A....

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Similar questions

The materials price variance is usually computed a. when goods are finished. b. when materials are issued to production. c. when materials are purchased. d. after suppliers are paid. e. None of these.
Which of the following is true concerning labor variances that are not material in amount? a. They are closed to Cost of Goods Sold. b. They are prorated among Work in Process, Finished Goods, and Cost of Goods Sold. c. They are prorated among Materials, Work in Process, Finished Goods, and Cost of Goods Sold. d. They are reported as part of Overall Variance on the balance sheet at the end of the year.
A. Describe the two variances between the actual costs and the standard costs for factory overhead. B. What is a factory overhead cost variance report?
Refer to the information for Cinturon Corporation on the previous page. Required: 1. Break down the total variance for labor into a rate variance and an efficiency variance using the columnar and formula approaches. 2. CONCEPTUAL CONNECTION As part of the investigation of the unfavorable variances, the plant manager interviews the production manager. The production manager complains strongly about the quality of the leather strips. He indicates that the strips are of lower quality than usual and that workers have to be more careful to avoid a belt with cracks and more time is required. Also, even with extra care, many belts have to be discarded and new ones produced to replace the rejects. This replacement work has also produced some overtime demands. What corrective action should the plant manager take?
Why does a company use a standard costing system? A. to identify variances from actual cost that assist them in maintaining profits B. to identify nonperformers in the workplace C. to identify what vendors are unreliable D. to identify defective materials
What are some reasons for a material quantity variance? A. building rental charges increase B. labor rate decreases C. more qualified workers D. labor efficiency increases
Which of the following is a possible cause of an unfavorable labor rate variance? A. hiring too many workers B. hiring higher-quality workers at a higher wage C. making too many units D. purchasing too much material
The variable overhead rate variance is caused by the sum between which of the following? A. actual and standard allocation base B. actual and standard overhead rates C. actual and budgeted units D. actual units and actual overhead rates
An unfavorable volume variance can occur because a. too much finished goods inventory was held. b. the company overproduced. c. the actual output was less than expected or practical capacity. d. the actual output was greater than expected or practical capacity. e. All of these.
Which of the following is a possible cause of an unfavorable material quantity variance? A. purchasing substandard material B. hiring higher-quality workers C. paying more than should have for workers D. purchasing too much material
If variances are recorded in the accounts at the time the manufacturing costs are incurred, what does a debit balance in Direct Materials Price Variance represent?
Performance Report for Variable Variances Potter Company provided the following information: Required: Prepare a performance report that shows the variances for each variable overhead item (inspection and power).