2. LO 8.1This standard is set at a level that may be reached with reasonable effort.

1. ideal standard
2. attainable standard
3. unattainable standard
4. variance from standard

4. LO 8.1This variance is the difference involving spending more or using more than the standard amount.

1. favorable variance
2. unfavorable variance
3. no variance
4. variance

6. LO 8.2What are some possible reasons for a material price variance?

1. substandard material
2. labor rate increases
3. labor rate decreases
4. labor efficiency

8. LO 8.2When is the material price variance favorable?

1. when the actual quantity used is greater than the standard quantity
2. when the actual quantity used is less than the standard quantity
3. when the actual price paid is greater than the standard price
4. when the actual price is less than the standard price

10. LO 8.2When is the material quantity variance favorable?

1. when the actual quantity used is greater than the standard quantity
2. when the actual quantity used is less than the standard quantity
3. when the actual price paid is greater than the standard price
4. when the actual price is less than the standard price

12. LO 8.3What are some possible reasons for a labor rate variance?

1. hiring of less qualified workers
2. an excess of material usage
3. material price increase
4. utilities usage change

14. LO 8.3When is the labor rate variance favorable?

1. when the actual quantity used is greater than the standard quantity
2. when the actual quantity used is less than the standard quantity
3. when the actual price paid is greater than the standard price
4. when the actual price is less than the standard price

16. LO 8.3When is the direct labor time variance favorable?

1. when the actual quantity used is greater than the standard quantity
2. when the actual quantity used is less than the standard quantity
3. when the actual price paid is greater than the standard price
4. when the actual price is less than the standard price

18. LO 8.4A flexible budget ________.

1. predicts estimated revenues and costs at varying levels of production
2. gives actual figures for selling price
3. gives actual figures for variable and fixed overhead
4. is not used in overhead variance calculations

20. LO 8.4The variable overhead efficiency variance is caused by the difference between which of the following?

1. actual and budgeted units
2. actual and standard allocation base
3. actual and standard overhead rates
4. actual units and actual overhead rates

22. LO 8.5Which of the following is a possible cause of an unfavorable material price variance?

1. purchasing too much material
2. purchasing higher-quality material
3. hiring substandard workers
4. buying substandard material

24. LO 8.5Which of the following is a possible cause of an unfavorable labor efficiency variance?

1. hiring substandard workers
2. making too many units
3. buying higher-quality material
4. paying too much for workers