10. The standard rate per hour for direct labor should not include an allowance
ID: 2544634 • Letter: 1
Question
10. The standard rate per hour for direct labor should not include an allowance for fringe benefits since these benefits represent an element of manufacturing overbead. True False 1I. The general model for variance analysis holds price constant at the standard price for calculation of the quantity variance. False True 12. ROI tends to emphasize long-rum performance rather than short-run profitability. True False 13. Land held for possible plant expansion would be included as an operating asset in the ROI calculation. True False 14. Residual income is used in the numerator to compute turnover in an R Ol analysis. TrueFalse 15. In ROI the use of net book value as part of operating assets is consistent with the reporting of plant and equipment on the balance sheet. True False 16. Return on Investment would experience the greatest decrease if both turnover and margin decrease. True False 17. A manufacturing cycle efficiency (MCE) ratio is always less than 1.00. True False 18. The EOQ process seeks to minimize inventory ordering costs and inventory carrying costs. True False 19. Fixed cost are fixed in total but vary inverse to level of activity per unit. True False 20. Variable cost are fixed per unit but vary in total. True False . Ifoverhead is over-applied, then too much cost has been put into production. True FalseExplanation / Answer
17. The statement is true as, MCE is always below or )
less than1.00.
18.Its true because the main aim of EOQ is to minimise the inventory ordering and holding costs.
19. Yes, fixed costs remains unchanged in total but vary Inverse to level of activity per unit.
20.As variable costs are fixed per unit of production and varies in total, the given statement is correct.
21.The given statement is also true as per knowledge because, over applied means incurring more costs.
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