Flashcards in Deck 6 Deck (20):

1

## DM quantity usage variance =

### Standard price x (Actual quantity used - standard quantity allowed)

2

## DL rate variance =

### Actual hours worked x (AR - SR)

3

## DL efficiency variance =

### Standard rate x (Actual hours worked - standard hours allowed)

4

## VOH variance can be broken into two separate variances:

### Rate (spending) variance and Efficiency variance

5

## FOH variance can be broken into two separate variances:

### Budget (spending) variance and Volume variance

6

## VOH rate (spending) variance =

### Actual hours x (AR - SR)

7

## VOH efficiency variance =

### Standard rate x (Actual hours - standard hours allowed for actual production volume)

8

## FOH budget (spending) variance =

### Actual FOH - Standard FOH

9

## FOH volume variance (aka production volume variance) =

### budgeted FOH - standard FOH allocated to production

10

## Applied OH under standard costing =

### Standard cost driver for actual activity x OH rate

11

## Production volume variance =

### (Actual production - budgeted production) x per unit standard FOH rate

12

## Sales price variance =

### (Actual SP - budgeted SP) x actual sold units

13

## Sales volume variance =

### (Actual sold units - budgeted sold units) x standard contribution margin per unit

14

## Strategic business units are classified by 4 financial measures:

### 1. Cost SBU (lowest level), 2. Revenue SBU, 3. Profit SBU, and 4. Investment SBU (highest level)

15

## 4 critical success factors of a balanced scorecard

### F: financial; I: internal business processes; C: customer satisfaction; and A: advancement of innovation and HR

16

## Net Present Value =

### Initial investment - PV of cash flows

17

## Payback period =

### Initial investment / cash inflows per period

18

## Internal Rate of Return (IRR) can be misleading when there are:

### Alternating periods of cash inflows and outflows

19

## IRR =

### Net incremental investment / Net annual cash flows

20