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CMA Part 1: Financial Planning - Performance and Analytics Exam

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CMA Part 1: Financial Planning - Performance and Analytics Exam Questions and Answers

Questions 1

Collins Corporation manufactures its products in a highly automated, just-in-time environment and uses a standard cost system. The variance that would cause the least concern would be a

Options:

A.  

6% unfavorable fixed overhead volume variance caused by work stoppages because of missing parts

B.  

9% unfavorable material price variance caused by changing to a supplier that would support the company's just-in-time needs.

C.  

30% unfavorable direct labor efficiency variance caused by idle time while waiting for goods to be received from a previous manufacturing department

D.  

12% unfavorable variable overhead spending variance caused by keeping equipment running during times when there is no production activity