Rogstad Corporation Manufactures and Sells a Single Product

question 124

Multiple Choice

Rogstad Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 6,700 units, but its actual level of activity was 6,670 units. The company has provided the following data concerning the formulas to be used in its budgeting: The activity variance for direct labor in March would be closest to:

• A) $2,406 U
• B) $216 U
• C) $216 F
• D) $2,406 F

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Definitions:

Cash Receipts Journal

A financial journal that records all cash inflows to the business, including sales, loan proceeds, and investment income.

General Ledger

A complete record of all financial transactions over the life of a company, serving as the primary data source for the financial statements.

Accounts Receivable

Unpaid amounts by customers to a company for goods or services already rendered.

Cash Receipts Journal

A dedicated journal used to record all cash inflows or receipts of a business.