Oxford CoHas a Materials Standard of 2

question 83

Multiple Choice

Oxford Co.has a materials standard of 2.1 pounds per unit of output.Each pound has a standard price of $10 per pound.During February,Oxford Co.paid $57,220 for 4,840 pounds,which were used to produce 2,400 units.What is the direct materials price variance?

• A)$6,820 unfavorable
• B)$8,820 unfavorable
• C)$8,820 favorable
• D)$6,820 favorable

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Definitions:

Unprofitable Operations

Business activities that result in a net loss rather than generating profit for the company.

Leveraged Buyout

A transaction where a company is acquired using a significant amount of borrowed money to meet the cost of acquisition.

Going-Private Transactions

All publicly owned stock in a firm is replaced with complete equity ownership by a private group.