Steve Has to Submit a Timecard Every Week and His

question 110

Multiple Choice

Steve has to submit a timecard every week and his compensation is based upon the amount of time he works, rather than what he accomplishes. Steve is compensated based on

• A)piecework.
• B)competence.
• C)skilled labor.
• D)hourly work.

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Definitions:

Direct Materials Price Variance

The difference between the actual cost of direct materials purchased and the expected (standard) cost multiplied by the actual quantity purchased.

Standard Costs

Standard costs are the estimated costs associated with the production of goods or services, used as target costs to aid in budgeting and performance evaluation.

Actual Costs

The real costs that a company incurs for producing or acquiring goods or services.

Direct Materials Price Variance

The difference between the actual cost of direct materials used in production and the standard cost of materials that were expected to be used.