Q. A company budgeted for 5,000 hours of labor at a rate of $20 per hour. If the actual labor cost was $110,000 for 6,000 hours, what is the labor efficiency variance?
A.
$10,000 Favorable
B.
$10,000 Unfavorable
C.
$20,000 Favorable
D.
$20,000 Unfavorable
Show solution
Solution
Labor Efficiency Variance = (Actual Hours - Budgeted Hours) * Budgeted Rate = (6,000 - 5,000) * $20 = $20,000 (Unfavorable)
Correct Answer:
B
— $10,000 Unfavorable
Learn More →
Q. A company has a budgeted fixed overhead of $100,000 and actual fixed overhead of $90,000. What is the fixed overhead variance?
A.
$10,000 Favorable
B.
$10,000 Unfavorable
C.
$20,000 Favorable
D.
$20,000 Unfavorable
Show solution
Solution
Fixed Overhead Variance = Actual Fixed Overhead - Budgeted Fixed Overhead = $90,000 - $100,000 = -$10,000 (Favorable)
Correct Answer:
A
— $10,000 Favorable
Learn More →
Q. A company has a budgeted sales revenue of $500,000 and actual sales revenue of $450,000. What is the sales variance?
A.
$50,000 Favorable
B.
$50,000 Unfavorable
C.
$100,000 Favorable
D.
$100,000 Unfavorable
Show solution
Solution
Sales Variance = Actual Sales - Budgeted Sales = $450,000 - $500,000 = -$50,000 (Unfavorable)
Correct Answer:
B
— $50,000 Unfavorable
Learn More →
Q. A company has a budgeted variable cost of $3 per unit for 10,000 units. If the actual variable cost is $4 per unit for 12,000 units, what is the total variable cost variance?
A.
$12,000 Favorable
B.
$12,000 Unfavorable
C.
$24,000 Favorable
D.
$24,000 Unfavorable
Show solution
Solution
Total Variable Cost Variance = (Actual Cost - Budgeted Cost) = ($4 * 12,000) - ($3 * 10,000) = $48,000 - $30,000 = $18,000 (Unfavorable)
Correct Answer:
D
— $24,000 Unfavorable
Learn More →
Q. A company planned to produce 10,000 units at a cost of $5 per unit. If the actual cost was $6 per unit, what is the total cost variance?
A.
$10,000 Favorable
B.
$10,000 Unfavorable
C.
$5,000 Favorable
D.
$5,000 Unfavorable
Show solution
Solution
Total Cost Variance = (Actual Cost - Budgeted Cost) * Actual Units = ($6 - $5) * 10,000 = $10,000 (Unfavorable)
Correct Answer:
B
— $10,000 Unfavorable
Learn More →
Q. A company planned to sell 15,000 units at $10 each but sold only 12,000 units. What is the sales volume variance?
A.
$30,000 Favorable
B.
$30,000 Unfavorable
C.
$15,000 Favorable
D.
$15,000 Unfavorable
Show solution
Solution
Sales Volume Variance = (Actual Units - Budgeted Units) * Selling Price = (12,000 - 15,000) * $10 = -$30,000 (Unfavorable)
Correct Answer:
B
— $30,000 Unfavorable
Learn More →
Q. If a company budgeted $200,000 for direct materials but actually spent $220,000, what is the direct materials variance?
A.
$20,000 Favorable
B.
$20,000 Unfavorable
C.
$40,000 Favorable
D.
$40,000 Unfavorable
Show solution
Solution
Direct Materials Variance = Actual Cost - Budgeted Cost = $220,000 - $200,000 = $20,000 (Unfavorable)
Correct Answer:
B
— $20,000 Unfavorable
Learn More →
Q. If a company has a budgeted contribution margin of $200,000 and an actual contribution margin of $180,000, what is the contribution margin variance?
A.
$20,000 Favorable
B.
$20,000 Unfavorable
C.
$40,000 Favorable
D.
$40,000 Unfavorable
Show solution
Solution
Contribution Margin Variance = Actual Contribution Margin - Budgeted Contribution Margin = $180,000 - $200,000 = -$20,000 (Unfavorable)
Correct Answer:
B
— $20,000 Unfavorable
Learn More →
Q. If a company has a budgeted profit of $50,000 and an actual profit of $40,000, what is the profit variance?
A.
$10,000 Favorable
B.
$10,000 Unfavorable
C.
$20,000 Favorable
D.
$20,000 Unfavorable
Show solution
Solution
Profit Variance = Actual Profit - Budgeted Profit = $40,000 - $50,000 = -$10,000 (Unfavorable)
Correct Answer:
B
— $10,000 Unfavorable
Learn More →
Showing 1 to 9 of 9 (1 Pages)
