Chapter 11

Question 1

Standard quantity per unit

Answer 1

The amount of an input that should be required to complete a single unit of product, including allowances for normal waste, spoilage, rejects, and other normal inefficiencies.

Question 2

Standard Price Per Unit

Answer 2

The price that should be paid for an input.

Question 3

standard direct materials cost per item

Answer 3

Standard Quantity Per Unit * Standard Price Per Unit

Question 4

Standard Hours Per Unit

Answer 4

The amount of direct labor time that should be required to complete a single unit of product, including allowances for breaks, machine downtime, cleanup, rejects, and other normal inefficiencies.

Question 5

Standard Rate Per Hour

Answer 5

The labor rate that should be incurred per hour of labor time, including employment taxes and fringe benefits.

Question 6

standard direct labor cost per item

Answer 6

direct labor hours per item * price per direct labor hour

Question 7

Price Variance

Answer 7

A variance that is computed by taking the difference between the actual price and the standard price and multiplying the result by the actual quantity of the input.

Question 8

quantity variance

Answer 8

A variance that is computed by taking the difference between the actual quantity of the input used and the amount of the input that should have been used for the actual level of output and multiplying the result by the standard price of the input. `

Question 9

Standard Quantity Allowed

Answer 9

The amount of an input that should have been used to complete the period’s actual output. It is computed by multiplying the actual number of units produced by the standard quantity per unit.

Question 10

Standard Hours Allowed

Answer 10

The time that should have been taken to complete the period’s output. It is computed by multiplying the actual number of units produced by the standard hours per unit.

Question 11

Material Price Variance

Answer 11

The difference between the actual unit price paid for an item and the standard price, multiplied by the quantity purchased.

Question 12

Material Quantity Variance

Answer 12

The difference between the actual quantity of materials used in production and the standard quantity allowed for the actual output, multiplied by the standard price per unit of materials.