1.

Which of these standards are based on efficient operating conditions

A. Basic standards
B. Ideal Standards
C. Attainable standards
D. Current standards
2. Which of these are the least used type of standards
A. Basic standard
B. Ideal standard
C. Attainable standards
D. Current standards
3. The following statement shows budgeted and actual costs for the month of April for
Department A
Original Budget Actual Result
Sales 840000 852000
Direct Materials 225000 240000
Direct Labour 320000 330000
Production overhead:
Variable 97500 100000
Fixed 80000 85000
Total costs 722500 755000
Profit 117500 97000
Machine hours budgeted was 6500 and actual was 6250 while Sales were budgeted 7000
units and actual 7100.
Calculate the standard cost per unit under marginal costing
4. Difference in sales volume variance is calculated on the basis of profit per unit in which type
of costing
A. Absorption costing
B. Marginal costing
5. JO Ltd has budgeted sales of 750 units at $1.25 each. The variable costs are expected to be
$0.5 per unit, and fixed costs are to be absorbed at $0.1 per unit. The actual sales were 690
units at $1.5 each and variable costs were $0.6 and fixed costs were as expected. Calculate
the sales price variance using absorption costing method
A. $172.5 adverse
B. $172.5 favourable ans
C. $39 adverse
D. $39 favourable
6. HUL Ltd makes a single product with the following
budgeted material costs per unit:
5 kg of material A at $5/kg
Actual details:
Output 600 units
Material purchased and used 3150 kg Material cost $15120
Calculate the materials price variance
A. $630 favourable ans
B. $630 adverse
7. Using the above find out the material usage variance
A. $750 favourable
B. $750 adverse ans
8. James Ltd makes a single product and has the following budgeted information:
Budgeted production 2400 units
 Budgeted labour hours 4500 hours
Budgeted labour cost $17800
Actual results:
Output 2500 units
Hours paid for 4650 hours
Labour cost $19840

What is the labour rate variance?

A. $1447 Favourable
B. $1447 Adverse
C. $2040 favourable
D. $2040 adverse
9. Using the above, find out labour efficiency variance
A. $593 favourable
B. $593 adverse
10. The budgeted output for MEA Ltd for May was 3200 units of product A. Each unit requires 4
direct labour hours. Variable overheads are budgeted at $4/labour hour.
Actual results:
Output 3600 units
Labour hours worked 14000 hours
Variable overheads $54800

Calculate overhead efficiency variance

A. $4600 favourable
B. $4600 adverse
C. $4800 favourable
D. $4800 adverse
11. Which type of fixed overhead variance is present in both marginal and absorption costing
A. Fixed overhead expenditure variance
B. Fixed overhead volume variance
12. The following information is available for a company for a period
Budget
Output $24800
Unit 3100
Actual
Fixed production overheads $23960
Unit 2950
What is fixed overhead volume variance
A. $1600 favourable
B. $1600 adverse
C. $1200 favourable
D. $1200 adverse
13. Using the above example, calculate fixed overhead total variance according to marginal
costing
A. $840 favourable
B. $840 adverse
14. The following information is available for a company for a period
Budget:
Output $24800
Unit 3100
Standard time to produce each unit is 1.5 hours
 Actual:
Fixed production overheads $23960
Unit 2950
Labour hours 4350
Calculate fixed overhead efficiency variance
A. $450 favourable
B. $450 adverse
C. $400 favourable
D. $400 adverse
15. Which of these is a cause of sales price variance
A. Unexpected fall in demand due to recession
B. Failure to satisfy demand
C. General price increase of raw materials
D. All of the above
16. There was a training programme set up for production labour in a company after which the
production speed of employees increased. Which of these would show favourable variances
after the training programme
A. Fixed overhead volume variance
B. Sales price variance
C. Labour efficiency variance
D. Variable overhead efficiency variance
17. In a period actual profit was $40000. The following are the variance occurred in the period
Direct material price 450 adverse
Direct material usage 300 adverse
Direct labour rate 600 fav
Direct labour efficiency 400 fav
What was the budgeted profit for the period
A. $40250
B. $39750
C. $40550
D. $39250