14. A favorable price variance for direct materials indicates that A) Actual price paid for material is higher than planned (standard) B) Material used was higher than planned for actual output C) Actual price paid for material is lower than planned (standard) D) Material used was higher than planned for actual output 15. Which of the following will most likely improve a materials price variance? c a buying raw materials in large quantities b. hiring more purchasing agents laying off purchasing agents d. none of the above 16. Unfavorable material quantity variances Means that the actual price paid is more than the planned (standard price b. Mean that smaller quantity discounts were taken on purchases c. Mean that more direct materials were used than planned (standard) for actual output d. Mean that less indirect materials were used than planned (standard) for soul output e. None of the above 17. Are avoidable costs relevant in all situations where discontinuance of a product line of business segment decisions are made? a) b) c) d) Yes, avoidable costs are always relevant No, avoidable costs are always irrelevant. No, they represent the costs that cannot be eliminated when a product line or a business segment is discontinued. No, they may or may not be relevant because not all costs differ between the alternatives of continuing or discontinuing the product line or business segment. 18. Sunk costs A) cannot be changed B) are never relevant C) are historical costs D) all of the above 19. Which of the following is an example of a make-or-buy decision? a) Adding a product line. b) Dropping a segment. c) Subcontracting work in place of using the company's own employees. d) Hiring skilled labor in place of unskilled labor