Chapter 8 16. Direct labor time standards express the hourly labor cost per func
ID: 2498730 • Letter: C
Question
Chapter 8
16. Direct labor time standards express the hourly labor cost per function or job classification that exists during the current accounting period.
a. True
b. False
17. The direct materials price standard for a period is determined by averaging that period’s cost of direct material purchases.
a. True
b. False
18. The direct labor rate variance is the difference between the standard hours allowed and the actual hours multiplied by the actual labor rate.
a. True
b. False
19. The total overhead cost variance is the difference between what actual overhead cost is and what it should have cost according to the flexible budget for the good units produced.
a. True
b. False
20. The variable overhead efficiency variance is the difference between actual total overhead costs incurred and the total overhead costs applied using the standard overhead rates.
a. True
b. False
Explanation / Answer
16. Statement is false. Direct labour time standard expresses the time taken to perform a funtion not hourly labour cost per function.
17. Statement is true. Direct material price standard is determined by averaging that period's cost of direct material purchases.
18. Statement is false. Direct labour rate variance is a difference between standard rate and actual rate multiplied by actual working hours.
19. Statement is true. Total overhead cost variance is difference between actual overhead cost and cost according to the flexible budget for the good units produced.
20. Statement is false. Variable overhead efficiency variance is the difference between standard overhead cost total overhead cost applied using the standard overhead rates.