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US CMA Part 1 Standard Costs and Variances — practice questions

Explore 23 free Standard Costs and Variances questions in US CMA Part 1 Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Standard Costs and Variances questions and exercises with answers

Showing questions 1–23 of 23.

A variance is defined as a difference between the standard and the:Read the answer and worked solution →A variance arises when performance does not match:Read the answer and worked solution →Variances are described as falling into how many kinds?Read the answer and worked solution →An unfavorable variance involves spending or using an amount that is:Read the answer and worked solution →Direct materials may show a variance in the quantity used or in the:Read the answer and worked solution →Direct labor may show a variance in the amount of time used or in the:Read the answer and worked solution →How many components are there to a direct materials variance?Read the answer and worked solution →The two components of a direct materials variance are the price variance and the:Read the answer and worked solution →Both components of the direct materials variance compare the actual figure to the:Read the answer and worked solution →A syllabus is used as an analogy for which management tool?Read the answer and worked solution →An instructor's syllabus is described as one way to communicate expectations to:Read the answer and worked solution →A favorable material price variance is described as possibly causing an unfavorable:Read the answer and worked solution →Alongside labor efficiency, a favorable material price variance could also cause an unfavorable:Read the answer and worked solution →Buying cheaper but poorer material that workers waste illustrates that variances can be:Read the answer and worked solution →Using 10 kilograms of material where the standard allowed 8 produces which variance?Read the answer and worked solution →Paying workers less per hour than the standard rate produces which variance?Read the answer and worked solution →A standard cost is described as being developed in order to:Read the answer and worked solution →Spending exactly the standard amount on materials produces a variance of:Read the answer and worked solution →Pull the rope to favorable or notRead the answer and worked solution →Sort the variancesRead the answer and worked solution →Stack the variance termsRead the answer and worked solution →Match each variance termRead the answer and worked solution →Complete the variance rulesRead the answer and worked solution →

Worked practice questions

A variance is defined as a difference between the standard and the:

  1. Actual performance
  2. Budgeted revenue
  3. Forecast headcount
  4. Historical average
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Correct answer: A. Actual performance

1. A variance compares two figures. 2. A standard sets out what performance is expected. 3. When performance does not match expectations, a variance arises. 4. It is a difference between the standard and the actual performance. _Source: OpenStax Principles of Accounting, Volume 2: Managerial Accounting (CC BY-NC-SA 4.0), Ch 8 'Standard Costs and Variances'_

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A variance arises when performance does not match:

  1. The headcount plan
  2. Expectations
  3. Last year's figure
  4. The share price
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Correct answer: B. Expectations

1. Variances are defined against an expectation. 2. A standard cost communicates what is expected. 3. When your performance does not match your expectations, a variance arises. 4. That variance is the gap between standard and actual. _Source: OpenStax Principles of Accounting, Volume 2: Managerial Accounting (CC BY-NC-SA 4.0), Ch 8 'Standard Costs and Variances'_

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Variances are described as falling into how many kinds?

  1. Two kinds
  2. Three kinds
  3. Five kinds
  4. Ten kinds
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Correct answer: A. Two kinds

1. Variances are classified by which way they go. 2. A variance is a difference between standard and actual performance. 3. There are favorable and unfavorable variances. 4. The direction of the difference decides which it is. _Source: OpenStax Principles of Accounting, Volume 2: Managerial Accounting (CC BY-NC-SA 4.0), Ch 8 'Standard Costs and Variances'_

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