TaskMaster Enterprises Employs a Standard Cost System in Which Direct

question 80

Multiple Choice

TaskMaster Enterprises employs a standard cost system in which direct materials inventory is carried at standard cost. TaskMaster has established the following standards for the prime costs of one unit of product.
$\begin{array}{lclr}&\text { Standard } & \text { Standard } & \text { Standard } \\&\text { Quantity } & \text { Price } & \text { Cost }\\\text { Direct Materials } & \text { 8pounds } & \$ 1.80 \text { per pound } & \$ 14.40 \\\text { Direct Labor } & 0.25 \text { hour } & \$ 8.00 \text { per hour } & \underline{2.00}\\&&& \underline{\$16.40}\end{array}$


During November, TaskMaster purchased 160,000 pounds of direct materials at a total cost of $304,000. The total factory wages for November were $42,000, 90% of which were for direct labor. TaskMaster manufactured 19,000 units of product during November using 142,500 pounds of direct materials and 5,000 direct labor hours.
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What is the direct materials efficiency variance for November?

• A) $14,250
• B) $14,400
• C) $16,000
• D) $17,100

Understand the concept of cross elasticity of demand and how it indicates the relationship between goods.

Apply the midpoint formula to calculate the price elasticity of demand.

Analyze how changes in price affect the quantity demanded based on the elasticity coefficient.

Determine the elasticity of supply and its implications for pricing decisions.

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Definitions:

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