WGU D101 COST AND MANAGERIAL ACCOUNTING UNIT 6 EXAM
QUESTIONS WITH VERIFIED ANSWERS
100% Correct 60
Incorrect 0
1 of 60
Term
What happens when variances are small?
Give this one a go later!
The strategy of focusing attention on significant deviations from standard costs
or expectations. And is the basis for establishing control in a management
accounting system.
The materials price variance reflects the extent to which the actual price
varies from the standard price for the actual qu antity of materials
purchased or used.
The accounts for variances are generally closed into COGS to adjust this
account to actual costs. As a result, the inventory accounts on the balance
sheet include only standard costs.
, It is not to berate emp loy ees for failing to meet impossible exp ectations but
rather to provide information that will help management identify ways of
improving the purchasing process.
Don't know?
2 of 60
Definition
Step 1: AQ x SP (Actual Quantity of inputs X Standard Price)
10,150 feet X $10.00 = $101,500
Step 2: SQ x SP (Standard Quantity of inputs allowed for Actual
output X Standard Price
10,000 feet X $10 = $100,000
Step 3: (10,000 ft - 10,150 ft) x $10.00 = $1,500 U = Unfavorable
Variance
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How do you calculate (MPV) Materials Price Variance?
How do you calculate (MQV) Materials Quantity Variance?
Scenario: Direct Materials Cost Variances (based on quantity used in
production.)
100 boats produced
Direct materials Purchased:
Wood 9,800 ft at $9.60 per ft
Fiberglass 5,400 ft at $5.20 per
ft Direct Materials Used:
, Wood 10,150 ft
Fiberglass 3,925 ft
How do you calculate Direct Labor Rate Variance for the following scenario?
100 boats Produced.
Standard labor was 80 hours per boat @ $20.00 per
hour. Actual labor was 78.8 hours per boat @ $20.50 per
hour.
How do you calculate the Variable Overhead Spending Variance (VOSV) for the
following scenario?
Estimated data at begi nning of Year 1:
Manufacturing Overhead $100,000
Direct labor hours 40,000
Actual data for Year 1:
Manufacturing Overhead $90,000
Direct Labor hours 45,000
Produced during Year 1: 1,000 units
Standard number of direct labor hours per unit is 50
Don't know?
3 of 60
Term
What do variances not provide in regard to cost and
management analysis?
Give this one a go later!
, Variances DO NOT ANSWER
QUESTIONS; instead, the
Variances eliminate the need
variances point you in the right
for further analysis.
direction to ask the right
questions of the right people.
Variances provide definitive Variances directly improve
answers to management issues. production processes without
additional action.
QUESTIONS WITH VERIFIED ANSWERS
100% Correct 60
Incorrect 0
1 of 60
Term
What happens when variances are small?
Give this one a go later!
The strategy of focusing attention on significant deviations from standard costs
or expectations. And is the basis for establishing control in a management
accounting system.
The materials price variance reflects the extent to which the actual price
varies from the standard price for the actual qu antity of materials
purchased or used.
The accounts for variances are generally closed into COGS to adjust this
account to actual costs. As a result, the inventory accounts on the balance
sheet include only standard costs.
, It is not to berate emp loy ees for failing to meet impossible exp ectations but
rather to provide information that will help management identify ways of
improving the purchasing process.
Don't know?
2 of 60
Definition
Step 1: AQ x SP (Actual Quantity of inputs X Standard Price)
10,150 feet X $10.00 = $101,500
Step 2: SQ x SP (Standard Quantity of inputs allowed for Actual
output X Standard Price
10,000 feet X $10 = $100,000
Step 3: (10,000 ft - 10,150 ft) x $10.00 = $1,500 U = Unfavorable
Variance
Give this one a go later!
How do you calculate (MPV) Materials Price Variance?
How do you calculate (MQV) Materials Quantity Variance?
Scenario: Direct Materials Cost Variances (based on quantity used in
production.)
100 boats produced
Direct materials Purchased:
Wood 9,800 ft at $9.60 per ft
Fiberglass 5,400 ft at $5.20 per
ft Direct Materials Used:
, Wood 10,150 ft
Fiberglass 3,925 ft
How do you calculate Direct Labor Rate Variance for the following scenario?
100 boats Produced.
Standard labor was 80 hours per boat @ $20.00 per
hour. Actual labor was 78.8 hours per boat @ $20.50 per
hour.
How do you calculate the Variable Overhead Spending Variance (VOSV) for the
following scenario?
Estimated data at begi nning of Year 1:
Manufacturing Overhead $100,000
Direct labor hours 40,000
Actual data for Year 1:
Manufacturing Overhead $90,000
Direct Labor hours 45,000
Produced during Year 1: 1,000 units
Standard number of direct labor hours per unit is 50
Don't know?
3 of 60
Term
What do variances not provide in regard to cost and
management analysis?
Give this one a go later!
, Variances DO NOT ANSWER
QUESTIONS; instead, the
Variances eliminate the need
variances point you in the right
for further analysis.
direction to ask the right
questions of the right people.
Variances provide definitive Variances directly improve
answers to management issues. production processes without
additional action.
