Figure 17-1
Max Company Has Developed the Following Standards for One

question 70

Multiple Choice

Figure 17-1
Max Company has developed the following standards for one of its products: $\begin{array}{ll}\text { Direct materials } & 15 \text { pounds } \times £ 16 \text { per pound } \\\text { Direct labour } & 4 \text { hours } \times £ 24 \text { per hour } \\\text { Variable overhead } & 4 \text { hours } \times £ 14 \text { per hour }\end{array}$ The following activities occurred during the month of October: $\begin{array}{lc}\text { Materials purchased } & 10,000 \text { pounds costing } £ 170,000 \\\text { Materials used } & 7,200 \text { pounds } \\\text { Units produced } & 500 \text { units } \\\text { Direct labour } & 2,300 \text { hours at } £ 23.60 \text { per hour } \\\text { Actual variable overhead } & £ 30,000\end{array}$ The company records materials price variances at the time of purchase.
-Refer to Figure 17-1. Max's labour efficiency variance would be

• A)£7,200 unfavourable.
• B)£7,200 favourable.
• C)£6,280 unfavourable.
• D)£6,280 favourable.

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Definitions:

Positive Processing

Cognitive activities oriented towards and emphasizing positive aspects of a situation or experience.

Well-being

The state of being comfortable, healthy, or happy, often considered holistically to include physical, mental, and social dimensions.

Perceived Control

The belief that an individual has the ability to influence the events in their life, a concept related to self-efficacy and empowerment.

Self-reflection

The examination of one's own thoughts, feelings, and behaviors to gain insight or achieve personal growth.