Reference no: EM133063330
Questions -
Q1. Lucky Company's direct labor information for the month of February is as follows:
Actual direct labor hours worked (AQ) 61,500
Standard direct labor hours allowed (SQ) 63,000
Total payroll for direct labor $ 774,900
Direct labor efficiency variance $ 18,000
Required - What the total standard direct labor cost allowed for February?
a. $756,000.
b. $765,000.
c. $738,000.
d. $747,000.
e. $774,900.
Q2. Sheldon Company manufactures only one product and uses a standard cost system. During the past month, manufacturing operations for the company had the following variances: direct labor rate variance = $30,000 favorable; direct labor efficiency variance = $50,000 unfavorable. Sheldon allows 5 standard direct labor hours per unit produced, and its standard direct labor hourly pay rate is $50. During the month, the company used 25% more direct labor hours than the standard allowed. What were the total standard hours allowed (SQ) for the units manufactured during the month?
a. 2,500.
b. 4,000.
c. 5,000.
d. 1,000.
e. 6,000.
Q3. Build Corporation wants to purchase a new machine for $300,000. Management predicts that the machine can produce sales of $200,000 each year for the next 5 years. Expenses are expected to include direct materials, direct labor, and factory overhead (excluding depreciation) totaling $80,000 per year. The firm uses straight-line depreciation with no residual value for all depreciable assets. Build's combined income tax rate is 40%. Management requires a minimum after-tax rate of return of 10% on all investments. What is the net after-tax cash inflow in Year 1 from the investment?
a. $72,000.
b. $112,000.
c. $108,000.
d. $96,000.
e. $120,000.
Q4. Information concerning Johnston Company's direct materials costs is as follows:
Standard price per pound $6.45
Actual quantity purchased 2,850 pounds
Actual quantity used in production 2,750 pounds
Units of product manufactured 700
Materials purchase-price variance-favorable $855
Budget data for the period:
Units to manufacture 1,000
Units of direct materials 4,000 pounds
The direct materials usage variance for the period is?
a. $532.50 favorable.
b. $322.50 favorable.
c. $307.50 favorable.
d. $307.50 unfavorable.
e. $322.50 unfavorable.
Q5. The total variable factory overhead cost variance for a period can be broken down into what two variances?
a. Variable overhead spending variance and variable overhead price variance.
b. Variable overhead spending variance and variable overhead efficiency variance.
c. Variable overhead production variance and variable overhead volume variance.
d. Variable overhead price variance and variable overhead actual variance.
e. Variable overhead efficiency variance and variable overhead actual variance.