The Red Company Makes Mugs for Which the Following Standards

question 51

Multiple Choice

The Red Company makes mugs for which the following standards have been developed: $\begin{array}{cc}&\text { Standard Inputs } & \text { Standard Frice } \\&\text { Expected for Each } & \text { Expected per } \\&\text { Unit of Output } & \text { Unit of Output }\\\text { Direct materials } & 5 \text { ounces } & \$ 2 \text { per ounce } \\\text { Direct labor } & 1.5 \text { hours } & \$ 8 \text { per hour }\end{array}$ Production of 400 Mugs was expected in June, but 440 mugs were actually completed. Direct materials purchased and used were 2,100 ounces at an actual price of $2.20 per ounce.Direct-labor cost for the month was $5,310, and the actual pay per hour was $9.00._____ is the direct-labor quantity variance for the month of June.

• A)$1,560 favorable
• B)$1,560 unfavorable
• C)$1,800 favorable
• D)$1,800 unfavorable

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Definitions:

Compensation Data

Information related to the payment amounts and structures for various job roles within an organization, often used for benchmarking and setting salaries.

Personal Interviews

A method of qualitative research where questions are asked in a face-to-face setting to gather detailed insights and personal experiences.

Telephone Interviews

A method of data collection or interviewing conducted over the phone.

Wage Compression

A situation where differences in wages between employees become small, often because of external pressures, leading to reduced pay gaps between new and experienced employees, or between different job roles.