W4 A3 11- 13

11. Lion Company's direct labor costs for the month of January were as follows: Actual total direct labor-hours............ 20,0000 Standard total direct labor-hours.........21,000 Direct labor rate varianceunfavorable...$3,000 Total direct labor cost.........................$126,000 What was Lion's direct labor efficiency variance? A.$6000 favorable B.$6150 favorable C.$6300 favorable D.$6450 favorable

12.

Longview Hospital performs blood tests in its laboratory. The following standards have been set for each blood test performed: Standard Quantity or Hours Standard Price or Rate

Direct materials 2.0 plates $2.75 per plate

Direct labor 0.2 hours $15.00 per hour

Variable overhead 0.2 hours $7.00 per hour During May, the laboratory performed 1,500 blood tests. On May 1 there were no direct materials (plates) on hand; after a plate is used for a blood test it is discarded. Variable overhead is assigned to blood tests on the basis of direct labor hours. The following events occurred during May: 3,600 plates were purchased for $9,540 3,200 plates were used for blood tests 340 actual direct labor hours were worked at a cost of $5,550 The labor efficiency variance for May is: A.$600 F B.$600 U C.$515 U D.$515 F

13. The purpose of a flexible budget is to: A. allow management some latitude in meeting goals B.eliminate fluctuations in production reports by ignoring variable cost C.compare actual and budgeted results at virtually any level of activity D.reduce the time to prepare the annual budget