QUESTION 1

1. In the Balanced Scorecard system, core objectives and measures

	a.	are common across all organizations.
	b.	are common across all scorecard perspectives.
	c.	are common across departments.
	d.	none of the above.

QUESTION 2

A time and motion study revealed that it should take 3 hours to produce a product that currently takes 7.5 hours to produce. Labor is $18 per hour. Value added costs are

to.

$27.

b.

$54.

c.

$81.

d.

$135.

10 points

QUESTION 3

Communicating strategy through measurement requires both scope and flexibility. Which of the following statements is true?

to.

Flexibility requires subjective and objective measurement, as well as non-financial measures.

b.

Flexibility requires that the measures be optimal and dynamic.

c.

The scope implies that internal and external measures are needed.

d.

Both a and c are true

QUESTION 4

1. Which of the following is a characteristic of calculating standard cost variances for manufacturing overhead costs under an activity-based cost (ABC) system?

	a.	Fewer variances need to be reported, compared to the number of overhead variances calculated under a traditional cost system.
	b.	An ABC system would likely have a greater number of standard cost variances reported each period.
	c.	Flexible budgets are used for planning but not cost-control purposes.
	d.	Only non-volume-related cost drivers are used in the cost-allocation process.
	e.	The flexible budget variance will be the same under both a traditional cost system and an ABC system.

QUESTION 5

1. Ally Manufacturing uses a standard cost system and its July production of 1,800 units involved actual direct labor costs of $242,000 for 5,500 hours worked (AQ). The budget for July called for production of 2,000 units with 6,000 direct labor hours at $40.00 per hour (SP).

Ally's direct labor efficiency variance for July was:

	a.	$2,000 unfavorable.
	b.	$26,000 unfavorable.
	c.	$22,000 unfavorable.
	d.	$4,000 unfavorable.
	e.	$20,000 favorable.

QUESTION 6

1. What is the focus of operational control?

	a.	The activities of company executives.
	b.	Company protection.
	c.	The profitability of the company.
	d.	Short-term operating performance.
	e.	Long-term operating performance.

QUESTION 7

1. If inventories in a business using a standard cost system are insignificant, the firm would be justified (in a practical sense) by disposing of variances each year:

	a.	As a special item (gain or loss) on the income statement for the period.
	b.	As an adjustment to the finished goods inventory only.
	c.	As an adjustment to cost of goods sold only.
	d.	As adjustments to both inventory accounts and the cost of goods sold for the period.
	e.	As an adjustment to the work-in-process (WIP) inventory only.