Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 9, Problem 27E
Which of the following is the most likely explanation for an unfavorable materials usage variance and a favorable labor wage variance?
- a. The new labor contract increased wages.
- b. Higher quality materials were purchased, resulting in less waste.
- c. The company experience labor turnover and newer, less experienced workers were hired.
- d. A new supplier offered a lower price for materials.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Which of the following is a possible cause of an unfavorable material quantity variance?
A) paying more than should have for workers
B) purchasing too much material
C) hiring higher-quality workers
D) purchasing substandard material
Which one of the following may account for an adverse labour efficiency variance?
a. Using higher grade materials leading to lower wastage rates
O b. Change in labour-market conditions between the setting of the standard and the actual event
O c. Higher purchase cost of raw materials
d.
Using a higher grade of worker than was planned
Oe. Poor supervision
What would be the most likely cause of an unfavorable pay rate variance together with a favorable efficiency (usage) variance?
The employment of more highly skilled staff than budgeted
Improved efficiency of production
Poor wage negotiation by top management
Employment of less well-trained staff
Chapter 9 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 9 - Discuss the difference between budgets and...Ch. 9 - What is the quantity decision? The pricing...Ch. 9 - Why is historical experience often a poor basis...Ch. 9 - Prob. 4DQCh. 9 - How does standard costing improve the control...Ch. 9 - The budget variance for variable production costs...Ch. 9 - Explain why the direct materials price variance is...Ch. 9 - The direct materials usage variance is always the...Ch. 9 - The direct labor rate variance is never...Ch. 9 - Prob. 10DQ
Ch. 9 - Prob. 11DQCh. 9 - What is the cause of an unfavorable volume...Ch. 9 - Prob. 13DQCh. 9 - Explain how the two-, three-, and four-variance...Ch. 9 - Prob. 15DQCh. 9 - Prob. 1CECh. 9 - Direct Materials Usage Variance Refer to...Ch. 9 - Refer to Cornerstone Exercise 9.1. Guillermos Oil...Ch. 9 - Kavallia Company set a standard cost for one item...Ch. 9 - Yohan Company has the following balances in its...Ch. 9 - Standish Company manufactures consumer products...Ch. 9 - Variances Refer to Cornerstone Exercise 9.6....Ch. 9 - Standish Company manufactures consumer products...Ch. 9 - Mangia Pizza Company makes frozen pizzas that are...Ch. 9 - Mangia Pizza Company makes frozen pizzas that are...Ch. 9 - Refer to Cornerstone Exercise 9.9. Required: 1....Ch. 9 - Quincy Farms is a producer of items made from farm...Ch. 9 - During the year, Dorner Company produced 280,000...Ch. 9 - Zoller Company produces a dark chocolate candy...Ch. 9 - Oerstman, Inc., uses a standard costing system and...Ch. 9 - Refer to the data in Exercise 9.15. Required: 1....Ch. 9 - Chypre, Inc., produces a cologne mist using a...Ch. 9 - Refer to Exercise 9.17. Chypre, Inc., purchased...Ch. 9 - Delano Company uses two types of direct labor for...Ch. 9 - Jameson Company produces paper towels. The company...Ch. 9 - Madison Company uses the following rule to...Ch. 9 - Laughlin, Inc., uses a standard costing system....Ch. 9 - Responsibility for the materials price variance...Ch. 9 - Which of the following is true concerning labor...Ch. 9 - A company uses a standard costing system. At the...Ch. 9 - Relevant information for direct labor is as...Ch. 9 - Which of the following is the most likely...Ch. 9 - Haversham Corporation produces dress shirts. The...Ch. 9 - Plimpton Company produces countertop ovens....Ch. 9 - Algers Company produces dry fertilizer. At the...Ch. 9 - Misterio Company uses a standard costing system....Ch. 9 - Petrillo Company produces engine parts for large...Ch. 9 - Business Specialty, Inc., manufactures two...Ch. 9 - Vet-Pro, Inc., produces a veterinary grade...Ch. 9 - Refer to the data in Problem 9.34. Vet-Pro, Inc.,...Ch. 9 - Energy Products Company produces a gasoline...Ch. 9 - Nuevo Company produces a single product. Nuevo...Ch. 9 - Ingles Company manufactures external hard drives....Ch. 9 - As part of its cost control program, Tracer...Ch. 9 - Aspen Medical Laboratory performs comprehensive...Ch. 9 - Leather Works is a family-owned maker of leather...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Which of the following is a possible cause of an unfavorable labor rate variance? A. hiring too many workers B. hiring higher-quality workers at a higher wage C. making too many units D. purchasing too much materialarrow_forwardWhich of the following is a possible cause of an unfavorable labor efficiency variance? A. hiring substandard workers B. making too many Units C. buying higher-quality material D. paying too much for workersarrow_forwardWhich of the following is a possible cause of an unfavorable material quantity variance? A. purchasing substandard material B. hiring higher-quality workers C. paying more than should have for workers D. purchasing too much materialarrow_forward
- Which of the following is a possible cause of an unfavorable material price variance? A. purchasing too much material B. purchasing higher-quality material C. hiring substandard workers D. buying substandard materialarrow_forwardWhat are some possible reasons for a labor rate variance? A. hiring of less qualified workers B. an excess of material usage C. material price increase D. utilities usage changearrow_forwardWhy does a company use a standard costing system? A. to identify variances from actual cost that assist them in maintaining profits B. to identify nonperformers in the workplace C. to identify what vendors are unreliable D. to identify defective materialsarrow_forward
- What are some reasons for a material quantity variance? A. building rental charges increase B. labor rate decreases C. more qualified workers D. labor efficiency increasesarrow_forwardWhat are some possible reasons for a direct labor time variance? A. utility usage decrease B. less qualified workers C. office supplies spending D. sales declinearrow_forwardWhich of the following would produce a labor rate variance? A. Poor quality materials causing breakage and work interruptions.B. Use of persons with high hourly wage rates in tasks that call for low hourly wage rates.C. Excessive number of hours worked in completing a job.D. An unfavorable variable overhead spending variance.arrow_forward
- Which one of the following would not explain an adverse direct labor efficiency variance? A. Poor scheduling of direct labor hours. B. Unusually lengthy machine breakdowns. C. Setting standard efficiency at a level that is too low. D. A reduction in direct labor training.arrow_forwardWhich of the following statements are true? a. The standard price of materials should include delivery charges and any discounts. b. In general, the production manager is responsible for the materials price variance. C. An unfavorable materials quantity variance occurs when the actual quantity used in production is less than the standard quantity allowed for the actual output of the period. d. If skilled workers with high hourly rates of pay are given duties that require little skill and call for lower hourly rates of pay, this will result in a favorable labor rate variance. e. If variable manufacturing overhead is applied based on direct labor-hours, it is impossible to have a favorable labor efficiency variance and unfavorable variable overhead efficiency variance for the same period. O Statements b. and d. Statement c. O Statements a. and e. O None of the statements Statements d. and e.arrow_forwardWhich of the following is NOT a reason for an unfavorable direct materials quantity variance ? Purchasing of inferior raw materials Malfunctioning equipment Increased cost per unit of direct materials Employees using more material than budgetedarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningPrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY