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BT12203 BUSINESS ACCOUNTING CHAPTER 9: PERFORMANCE EVALUATION USING VARIANCES FROM STANDARD COSTS TUTORIAL QUESTIONS 1. An unfavorable materials quantity variance indicates that: A. actual usage of material exceeds the standard material allowed for output. B. standard material allowed for output exceeds the actual usage of material. C. actual material price exceeds standard price. D. standard material price exceeds actual price. 2. A favorable labor rate variance indicates that A. actual hours exceed standard hours. B. standard hours exceed actual hours. C. the actual rate exceeds the standard rate. D. the standard rate exceeds the actual rate. 3. If the actual labor hours worked exceed the standard labor hours allowed, what type of variance will occur? A. Favorable labor efficiency variance. B. Favorable labor rate variance. C. Unfavorable labor efficiency variance. D. Unfavorable labor rate variance. 4. Cox Company's direct material costs for the month of January were as follows: Actual quantity purchased. Actual unit purchase price.. Materials price variance-unfavorable (based on purchases)... Standard quantity allowed for actual production... Actual quantity used.. 18,000 kilograms $3.60 per kilogram $3,600 16,000 kilograms 15,000 kilograms For January there was a favorable direct materials quantity variance of: A. $3,360 B. $3,375 C. $3,400 D. $3,800 5. The following materials standards have been established for a particular product: