The Manager of the Quick Stop Corner Convenience Store (Which

question 11

Multiple Choice

The manager of the Quick Stop Corner Convenience Store (which never closes) sells four cases of Stein beer each day.Order costs are $20.00 per order,and Stein beer costs $8.00 per six-pack (each case of Stein beer contains four six-packs) .Orders arrive three days from the time they are placed.Daily holding costs are equal to five percent of the cost of a Stein beer case. If he has to order 16 cases of Stein beer at a time,what would be the daily total inventory costs,EXCLUDING the cost of the beer?

• A)$3.20
• B)$6.40
• C)$9.60
• D)$12.80
• E)$16.00

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Definitions:

Labor Rate Variance

The difference between the actual cost of direct labor and the estimated cost, indicating how well labor costs were controlled.

Direct Labor-hours

The complete tally of hours that workers, directly involved in making products or providing services, spend working.

Actual Direct Labor Cost

The total expense of labor directly involved in the production of goods or services, as it actually occurred.

Labor Rate Variance

Labor rate variance measures the difference between the actual labor costs incurred and the expected (or standard) labor costs, indicating discrepancies in wage rates or labor efficiency.