Refer to the Above Diagram

question 101

Multiple Choice

Refer to the above diagram.If society is currently producing the combination of bicycles and computers shown by point D, the production of 2 more units of bicycles:

• A)cannot be realized because resources are fully employed.
• B)will cost 1 unit of computers.
• C)will cost 2 units of computers.
• D)will cause some resources to become unemployed.

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Definitions:

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard amount expected to be used, multiplied by the standard cost per unit.

Materials Quantity Variance

The variance between the actual amount of materials utilized in manufacturing and the anticipated amount, multiplied by the established unit cost.

Raw Materials Price Variance

The difference between the actual cost and the standard cost of raw materials used in production.

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the expected amount of materials that should have been used, measured at the standard cost.