2. Which one of the following is most likely to be the responsibility of the purchasing manager?

A.The materials quantity variance.

B.The materials price variance.

C.The overhead volume variance.

D.The labor efficiency variance.

E.None of the answer choices is correct.

3. Which of the following is true about managers who adhere to the concept of "management by exception"?

A.Managers will investigate only favorable variances.

B.Managers will investigate only variances that are significant.

C.Managers will investigate all favorable and unfavorable variances.

D.Managers will investigate only unfavorable variances.

E.None of the answer choices is correct.

4. All of the following are possible causes of a favorable labor rate variance except:

A.a higher mix of unskilled workers causing hourly rates to be lower than anticipated.

B.product demand that was lower than expected causing a reduction in the amount of over-head initially anticipated.

C.a higher mix of skilled workers causing hourly rates to be higher than anticipated.

D.a new labor contract that was negotiated at lower pay rates than anticipated.

E.None of the answer choices is correct.

5. Which of the following would most likely be the reason for an unfavorable labor efficiency variance?

A.A higher mix of skilled workers made more efficient use of the labor hours.

B.The company used lower skilled workers than they anticipated to complete products.

C.High-quality materials resulted in less time spent working with materials waste.

D.An employee training program improved the efficient use of time.

E.None of the answer choices is correct.

6. If an analysis shows an unfavorable materials price variance of $22,000, the journal entry to record the purchase of direct materials and the related price variance would include:

A.a debit to Accounts Payable for $22,000. B.a debit for $22,000 to Materials Price Variance.

C.a credit for $22,000 to Materials Price Variance.

D.a credit to Work in Process Inventory for $22,000.

E.None of the answer choices is correct.

7. Which of the following is a possible cause for an unfavorable labor rate variance?

A.An unexpected increase in hiring new unskilled personnel.

B.Producing fewer units than expected.

C.An unexpected increase in demand caused the direct labor workforce to work overtime.

D.Using attainable standards rather than ideal standards.

E.None of the answer choices is correct.

8. Colfax Company incurred production labor costs of $5,400 in February (payable in March) for work requiring 1,100 standard hours at a standard rate of $15 per hour; 1,200 actual direct labor hours were worked. Based on this information, which one of the following would be included in the journal entry to record the labor costs?

A.$16,500 credit to Work-in-process Inventory.

B.$1,500 credit to Labor Efficiency Variance.

C.$16,200 credit to Wages Payable.

D.$1,500 credit to Labor Rate Variance.

E.None of the answer choices is correct.

9. The variable overhead efficiency variance is the difference between the actual hours worked at the standard rate and the standard hours worked at the standard rate.

A.True

B.False