The Owner of Crackers,Inc

question 15

Multiple Choice

The owner of Crackers,Inc.produces two kinds of crackers: Deluxe (D) and Classic (C) .She has a limited amount of the three ingredients used to produce these crackers available for her next production run: 4,800 ounces of sugar; 9,600 ounces of flour,and 2,000 ounces of salt.A box of Deluxe crackers requires 2 ounces of sugar,6 ounces of flour,and 1 ounce of salt to produce; while a box of Classic crackers requires 3 ounces of sugar,8 ounces of flour,and 2 ounces of salt.Profits for a box of Deluxe crackers are $0.40; and for a box of Classic crackers,$0.50.Which of the following is not a feasible production combination?

• A)0 D & 0 C
• B)0 D & 1,000 C
• C)800 D & 600 C
• D)1,600 D & 0 C
• E)0 D & 1,200 C

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Definitions:

Labor Rate Variance

The difference between the actual hourly wage paid to workers and the expected wage, multiplied by the actual hours worked.

Labor Efficiency Variance

The difference between the actual labor hours taken to produce a good or service and the standard labor hours expected, multiplied by the labor rate.

Direct Labor

Labor costs directly associated with the production of goods or services, including wages for workers who physically produce a product.

Standard Costs

Preset costs for delivering a product or service under normal conditions, used as benchmarks to measure actual performance.