1. If the direct labor rate variance is $500 Favorable and the direct labor efficiency variance is $300 Unfavorable, then which of the following is a true statement? A direct labor flexible budget variance is $200 favorable B actual total wages paid were $500 more than expected C actual labor hours were less than expected D actual material prices were less than expected

2. A favorable direct labor efficiency variance might indicate that A higher skilled workers were used that performed the task slower than expected. B higher skilled workers were used that performed the task faster than expected. C lower skilled workers were paid a higher wage than expected. D lower skilled workers were paid a lower wage than expected.

3. Which of the following is not a reason for using standard costing? A Comparing projected costs against actual costs B Planning and budgeting purposes C Pushing for ideal standards D Identifying specific areas for process improvement

4. Which of the following is not important to know when preparing the flexible budget performance report? A Actual production levels B Actual per-unit costs C Budgeted per-unit costs D Budgeted production levels

5. The purchasing manager was able to bring down the cost of direct materials by purchasing direct materials of a slightly lower grade quality than the company had used previously. The lower grade of direct materials, however, meant a higher defect rate on the assembly line and higher wastage of direct materials during production, which in turn lowered operating income. This situation would lead to a(n) A favorable direct materials quantity variance B unfavorable direct labor rate variance C favorable direct materials price variance D favorable direct labor efficiency variance