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CIMA BA2 Practice Test Chapter 7- Standard costing and variance analysis
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CIMA BA2 Practice Test Chapter 7- Standard costing and variance analysis
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BA 2 - Fundamentals of Management AccountingPractice questions
Standard costing and variance
analysis
Chapter seven
BA 2 - Standard costing and variance analysis. Quantia Learning
,01. A standard cost is:
A. the planned unit cost of a product, component or service in a period
B. the budgeted cost for the level of activity achieved in a budget centre in a control
period
C. the budgeted production cost for the level of activity in a budget period
D. the budgeted non-production cost for a product, component or service in a
period.
02. Complete the sentences below using some of the following words:
• Attainable standards
• Basic standards
• Ideal standards
• Current standards
Standards which remain unchanged over a period of years are known as ________.
Standards which assume efficient levels of operation, but which includes allowances for
factors such as waste and machine downtime, are known as _________.
03. The standard cost card for product F shows that each unit requires 3 kg of material at a
standard price of $9 per kilogram. Last period, 200 units of F were produced and $5,518
was paid for 620 kg of material that was bought and used.
Calculate the following variances and tick the correct box to indicate whether each
variance is adverse or favourable.
Adverse Favourable
The direct material price ● ●
variance is $
The direct material price ● ●
variance is $
BA 2 - Standard costing and variance analysis. Quantia Learning
, 04. Budgeted production of product V is 650 units each period. The standard cost card for
product V contains the following information.
$ per unit
Ingredients 12 litres @ $4 48
per litre
Direct labour 03 hours @ $9 27
per hour
Variable production overhead 03 hours @ $2 6
per hour
During the latest period 670 units of product V were produced. The actual results
recorded were as follows:
$ per unit
Ingredients purchased and 8,015 litres $33,663
used
Direct labour 2,090 hours $17,765
Variable production overhead $5,434
(a) The ingredients price variance is:
A. $1,503 favourable
B. $1,503 adverse
C. $1,603 favourable
D. $1,603 adverse
(b) The ingredients usage variance is:
A. $100 favourable
B. $100 adverse
C. $105 favourable
D. $860 adverse
BA 2 - Standard costing and variance analysis. Quantia Learning
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