Standard costs are based solely on actual costs in the past.

Quiz 8

Question 1

Standard costs are based solely on actual costs in the past.

True

False

Question 2

Predetermined overhead costs are the same as actual costs.

True

False

Question 3

Standard costs are NOT used for

a. determining actual costs

b. preparing budgets and forecasts

c. evaluating the performance of workers and management

d. developing appropriate selling prices.

Question 4

For which of the following can a standard cost accounting system be used?

a. direct materials

b. overhead

c. direct labor

d. all of the above

Question 5

A purpose of standard costing is

a. control costs

b. allocate costs more accurately

c. replace subjective decision making

d. compute the break-even point

Question 6

Which of the following is true of standard costing?

a. it uses estimates that are based only on past costs

b. it is the same as normal costing

c. it cannot be used to manage costing centers

d. it can be used in any type of business

Question 7

In a fully integrated standard costing system, standards costs eventually flow into the

a. cost of goods sold account

b. standard cost account

c. selling and administrative expenses account

d. sales account

Question 8

Service organizations do not develop standard rates for which of the following?

a. any service costs

b. overhead

c. direct materials

d. labor

Question 9

In standard costing

a. the standards are developed only for overhead costs

b. the standards are developed primarily from past costs

c. comparisons with actual costs usually are not performed

d. debit and credit entries to inventory accounts are made at standard costs

Question 10

An expression of the hourly pay cost per function or job classification that is expected to exist during the next accounting period is a definition of a

a. direct labor time standard

b. direct materials quantity standard

c. direct labor rate standard

d. variable overhead rate

Quiz 7

Question 1

All operating budgets should contain revenue and expense components.

True

False

Question 2

Evaluating the value chain and capacity issues are not part of the budgeting process.

True

False

Question 3

Budgets identify, gather, summarize and communicate

a. financial data only

a

b. financial and nonfinancial data

c. nonfinancial data only

d. None of the above

Question 4

Which of the following budgets is a financial budget?

a. sales budget

b. cash budget

c. direct labor budget

d. marginal expenditure budget

Question 5

Which of the following is NOT a guideline for budget preparation

a. revise budget to include planning decisions

b. know the sources of budget information

c. limit the use of a budget to one user group

d. establish the format of the budget

Question 6

In estimating cash receipts and cash payments for the cash budget, many companies prepare supporting schedules.

True

False

Question 7

Which of the following budgets would be prepared immediately after the preparation of the overhead budget?

a. cash budget

b. production budget

c. cost of goods sold budget

d. cost of goods manufactured budget

Question 8

A continuous budget is a 12-month forward-rolling budget that summarizes budgets for the next 12 months.

True

False

Question 9

A combined set of operational budgets and a set of financial budgets for the entire organization is known as

a. master budget

b. flexible budget

c. month-to-month budget

d. constant budget

Question 10

All budgets

a. never change

b. can be adjusted

c. are very inaccurate

d. none of the above