Multiple Choice Questions:

1) A favorable sales volume variance in sales revenue suggests a (n):

A) Increase in price.

B) Increase in number of actual units sold when compared to the expected number of units sold.

C) Increase in variable expenses per unit.

D) Decrease in fixed costs.

2) A favorable sales volume variance in variable expenses suggests a (n):

A) Increase in number of actual units sold.

B) Decrease in number of actual units sold when compared to the expected number of units sold.

C) Increase in variable expenses per unit.

D) Decrease in fixed costs.

3) An unfavorable sales volume variance in operating income suggests a (n):

A) Increase in number of actual units sold.

B) Decrease in number of actual units sold when compared to the expected number of units sold.

C) Increase in variable expenses per unit.

D) Decrease in fixed costs.

4) Which of the following is the correct formula to measure cost variance?

A) Cost Variance = (Actual Cost + Standard Cost) ÷ Actual Quantity

B) Cost Variance = (Actual Cost - Standard Cost) × Actual Quantity

C) Cost Variance = (Actual Cost + Standard Cost) + Actual Quantity

D) Cost Variance = (Actual Cost - Standard Cost) - Actual Quantity

5) Which of the following formulae is the correct formula to measure the efficiency variance?

A) Efficiency Variance = (Actual Quantity + Standard Quantity) - Standard Cost

B) Efficiency Variance = (Actual Quantity × Standard Quantity) ÷ Standard Cost

C) Efficiency Variance = (Actual Quantity ÷ Standard Quantity) × Standard Cost

D) Efficiency Variance = (Actual Quantity - Standard Quantity) × Standard Cost

Answer rating: 100% (QA)

1 B Increase in number of actual units sold when compared to the expected number of ... View the full answer