Which of the following comparisons best isolates the impact of a change in activity on performance?

• A.

  Static planning budget and flexible budget

• B.

  Static planning budget and actual results

• C.

  Flexible budget and actual results

• D.

  Master budget and static planning budget

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Question 45 of 474 Points

An unfavorable material price variance coupled with a favorable material usage variance would most likely result from:

• A. Labor efficiency problems.
• B. Machine efficiency problems.
• C. The purchase and use of higher than standard quality material.
• D. The purchase and use of lower than standard quality material.

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Question 46 of 474 Points

Which of the following statements is true?

• A.

  Directly comparing a static planning budget to actual costs helps to distinguish between differences in costs that are due to changes in activity and differences that are due to how well costs are controlled.

• B.

  A favorable spending variance occurs when actual costs exceeds the amount of the cost in the static planning budget.

• C.

  A revenue variance is favorable if the actual revenue exceeds what the revenue should have been for the actual level of activity for the period.

• D.

  In a flexible budget performance report, actual costs should be compared to the flexible budget at the original budgeted activity level.

• E. None of the above statements are true.

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Question 47 of 474 Points

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.