Solved Standard Costing and Variance Analysis (Cost

Standard Costing and Variance Analysis MCQs for Competitive Exams

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Topic Notes: Standard Costing and Variance Analysis

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Which of the following factors are primary contributors to material price variance in a manufacturing environment?

1, 3, 5 and 6

2, 3, 5 and 6

3, 4, 5 and 6

1, 3, 4 and 6

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What is the name of the budget that calculates expected revenues and costs based on the actual quantity of output produced?

variable budget

fixed budget

flexible budget

multiplied budget

Report

What is the result of multiplying the number of units by the price per unit in the context of flexible budgeting?

multiple budget variable

constant budget

flexible budget variable

fixed budget variable

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Which statement regarding standard costing is considered incorrect?

In standard costing, pre-determined costs control an entire organization

Standard maybe expressed in quantitative and monetary measures

Only adverse variances are investigated intensively

Standard is determined for each element of cost

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Which of the following formulas is used to calculate the labour rate of pay variance?

(Standard wage rate - Actual wage rate) × Actual hours worked

Budgeted labour costs - Actual labour costs

(Standard wage rate - Actual wage rate) × Standard hours worked

(Standard hours - Actual hours) × Actual wage rate

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In variance analysis, how is the material usage variance decomposed?

Material quantity variance

Material yield variance

Material cost variance

Material price variance

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Which variance is calculated by subtracting the actual selling price from the budgeted selling price and multiplying the result by the actual number of units sold?

selling price variance

investment variance

profit variance

cost variance

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Activity Ratio =

$$\frac{{{\text{Standard hours for actual production}}}}{{{\text{Budgeted standard hours}}}} \times 100$$

$$\frac{{{\text{Standard hours for actual production}}}}{{{\text{Actual hours worked}}}} \times 100$$

$$\frac{{{\text{Number of actual working days in a period}}}}{{{\text{Number of working days in the budget period}}}} \times 100$$

$$\frac{{{\text{Actual hours worked}}}}{{{\text{Budgeted hours}}}} \times 100$$

Report

How is the difference between the flexible budget amount and the static budget amount classified?

cost profit variance

sales revenue variance

sales volume variance

profit volume variance

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Which labor cost variance arises from the difference between the predetermined number of working days and the actual number of working days?

labour rate variance

labour efficiency variance

labour calender variance

labour idle time variance

Report

Standard Costing and Variance Analysis MCQs for Competitive Exams

Standard Costing and Variance Analysis MCQs for Competitive Exams

Topic Notes: Standard Costing and Variance Analysis

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