Which statement best describes the primary purpose of using standard costs? A. To eliminate the need for subjective decisions by managem B. To determine operating leverage ent C. To communicate performance expectations D. To allocate costs more accurately unity for getting a Which of the following bases for cost standards would give the manager the best opport FAVORABLE volume variance during the low volume part of the A. Normal capacity 8. The master budget level for the quarter season? D. Ideal capacity C. Practical capacity Which of the following statements about ideal standards is true? A Ideal standards make provisions for workers with different levels of expe B. Ideal standards allow for waste, spoilage, or machine breakdowns C. Ideal standards should be used for cash budgeting D. Ideal standards are theoretical best performance or maximu and product costing m-efficiency standards Which one of the following specific variances should be considered least important from the standpoint of controlling discretionary cash outlays? A. unfavorable labor efficiency variance amounted to 10% more than predicted for the budgeted hours at the actual output attained avorable materials price variance obtained by purchasing raw material from a new vendor B. F C. Fixed factory overhead volume variance resulting from management's decision midway through the fiscal year to reduce its overhead denominator level by 20% D. Unfavorable materials quantity variance amounting to 20% of the cost based on the quantity allowed for the output attained factory overhead is applied on the basis of standard direct labor hours. If, for a given period, the direct labor e A. Zero B. Unfavorable C. Favorable but possibly a different dollar amount D. Favorable and same $ amount as the labor efficiency variance During the current year, a department had overhead spending and volume varliances. The activity level selected for computing the predetermined overhead rate was 90% of practical capacity. The factory actually worked at 80% of capacity. If instead of 90% they elected to use 75% of practical capacity to compute the predetermined overhead rate, how would the variances have changed? A. It is not possible to predict. 8. Spending would appear the same, the volume variance would have changed from favorable to unfavorable. C. Spending would appear the same, the volume variance would have changed from unfavorable to favorable. D. Both spending and volume variance would appear to be better E. Both spending and volune variance would appear to be worse