Zanny Electronics Corporation Uses a Standard Cost System for the Production

question 457

Multiple Choice

Zanny Electronics Corporation uses a standard cost system for the production of its water ski radios. The direct labor standard for each radio is 0.9 hours. The standard direct labor cost per hour is $7.20. During the month of August, Zanny's water ski radio production used 6,600 direct labor-hours at a total direct labor cost of $48,708. This resulted in production of 6,900 water ski radios for August. What is Zanny's labor rate variance for August?

• A) $972 Favorable
• B) $1,188 Unfavorable
• C) $2,160 Favorable
• D) $2,808 Unfavorable

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Definitions:

Analyzing Texts

The process of examining written or printed material in detail to interpret its meaning, themes, structure, and cultural significance.

Preference

The favoring of one option over others, influenced by factors such as values, desires, and needs.

Autokinetic Effect

A phenomenon in which a stationary, small point of light in a dark room appears to move because of involuntary eye movements.

Normative Influence

The impact of societal norms and standards on an individual's behavior, often driving conformative actions.