Reference: 11-09
the Following Materials Standards Have Been Established for a Particular

question 109

Multiple Choice

Reference: 11-09
The following materials standards have been established for a particular product: $$\begin{array}{l}\begin{array} { | l | l | l | } \hline \text { Standard quantity per unit of output } & 6.8 & \text { metres } \\\hline \text { Standard price } & \$ 17.10 & \text { per metre } \\\hline\end{array}\\\text { The following data pertain to operations concerning the product for the last month: }\\\begin{array} { | l | l | l | } \hline \text { Actual materials purchased } & 9,000 & \text { metres } \\\hline \text { Actual cost of materials purchased } & \$ 156,600 & \\\hline \text { Actual materials used in production } & 8,500 & \text { metres } \\\hline \text { Actual output } & 1,200 & \text { units } \\\hline\end{array}\end{array}$$
-The fixed overhead volume variance is due to:

• A)a shift in the amount of hours required to produce the actual output.
• B)inefficient or efficient use of overhead resources.
• C)a difference between the denominator activity and the standard hours allowed for the actual output of the period.
• D)inefficient or efficient use of whatever the denominator activity is.

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Definitions:

Organizations

Entities composed of individuals and resources, structured to achieve specific goals through a collective effort.

Bureaucratic Control System

A formal system of organization based on clearly defined hierarchical levels and roles, focused on following rules and procedures to manage operations.

Organizational Culture

The collective values, beliefs, and principles of organizational members which give an organization its unique character.

Participative Organizational Culture

A workplace environment where decision-making is shared among employees at all levels, encouraging collaboration and collective ownership of outcomes.