Figure 17-2
Rax Company Has Developed the Following Standards for One

question 78

Multiple Choice

Figure 17-2
Rax Company has developed the following standards for one of its products:
Direct materials
12 pounds * £14 per pound
Direct labour
3 hours * £18 per hour
Variable overhead
3 hours * £8 per hour
The following activities occurred during the month of October: $\begin{array}{ll}\text { Materials purchased } & 10,000 \text { pounds at } £ 13.60 \text { per pound } \\\text { Materials used } & 9,000 \text { pounds } \\\text { Units produced } & 800 \text { units } \\\text { Direct labour } & 2,500 \text { hours at } £ 19.00 \text { per hour } \\\text { Actual variable overhead } & £ 22,000\end{array}$ The company records materials price variances at the time of purchase.
-Refer to Figure 17-2. Rax's materials price variance would be

• A)£4,000 unfavourable.
• B)£4,000 favourable.
• C)£1,600 unfavourable.
• D)£1,600 favourable.

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Definitions:

Sternomastoid

A muscle in the neck that rotates and flexes the head, also known as the sternocleidomastoid muscle.

Digastric

A muscle with two bellies connected by a central tendon, involved in the movement of the lower jaw and hyoid bone.

Anterior Thigh

The front part of the thigh, encompassing muscles like the quadriceps.

Rectus Femoris

One of the four quadriceps muscles, extending the knee and assisting in hip flexion.