Miguez Corporation Makes a Product with the Following Standard Costs

question 120

Multiple Choice

Miguez Corporation makes a product with the following standard costs: The company budgeted for production of 2,600 units in September, but actual production was 2,500 units. The company used 5,440 liters of direct material and 1,680 direct labor-hours to produce this output. The company purchased 5,800 liters of the direct material at $7.20 per liter. The actual direct labor rate was $24.10 per hour and the actual variable overhead rate was $1.90 per hour.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for September is:

• A) $3,675 F
• B) $3,528 U
• C) $3,528 F
• D) $3,675 U

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Definitions:

Reciprocal Determinism

A concept in psychology introduced by Albert Bandura that suggests individual behavior, environmental factors, and personal cognitive factors mutually influence each other.

Minnesota Multiphasic Personality Inventory

A standardized psychometric test of adult personality and psychopathology used to diagnose mental disorders.

Empirically Derived

Developed or derived from practical experience and observation rather than theory or pure logic, often through systematic scientific experimentation.

Managing Work

The process of overseeing or controlling job responsibilities and tasks to achieve the desired outcome efficiently.