The Budget for the Month of May Was for 9,000

question 48

Multiple Choice

The budget for the month of May was for 9,000 units at a direct materials cost of $15 per unit.Direct labor was budgeted at 45 minutes per unit for a total of $81,000.Actual output for the month was 8,500 units with $127,500 in direct materials and $77,775 in direct labor expense.The direct labor standard of 45 minutes was obtained throughout the month.Variance analysis of the performance for the month of May would show a(n) (CMA adapted)

• A)Favorable materials efficiency (quantity)variance of $7,500.
• B)Favorable direct labor efficiency variance of $1,275.
• C)Unfavorable direct labor efficiency variance of $1,275.
• D)Unfavorable direct labor price (rate)variance of $1,275.

---

Definitions:

Bell Curve

A graphical representation of a normal distribution of data, shaped like a bell, often used in statistical analysis.

Schematic Drawing

A simplified representation of an idea, object, or system, used to understand or explain its structure or function.

Most Direct

Refers to the simplest or straightest path or method to achieve something without detours or intermediaries.

Obstacle-Free Path

A route or course of movement that does not have any barriers or hindrances, facilitating smooth progression.