Walter, a Luthier, Is Assigned with the Task of Building

question 19

Multiple Choice

Walter, a luthier, is assigned with the task of building 20 guitars in six months. He is given a budget of $1,500,000 to buy the necessary raw materials required for building 20 guitars of same quality. In a period of four months, Walter is able to complete 75 percent of the work and spends $1,250,000 in the process. The project that Walter is working on has a spending variance of _____.

• A) $350,000
• B) $150,000
• C) $430,000
• D) $125,000
• E) $500,000

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Definitions:

Balance of Trade

The difference in value between a country's imports and exports over a certain period, indicating how much more goods and services a nation exports than it imports.

Services

Intangible products such as consulting, banking, cleaning, and education that are consumed at the point of sale.

Goods

Physical items that are produced and can be bought, sold, or traded.

Sweatshop Labor

Work that is performed in poor conditions for low pay and often violates labor laws.