EKPN CoProduces Wooden Boxes

question 106

Multiple Choice

EKPN Co.produces wooden boxes.The company's standards per box require 6 boards, each costing $10 per board, and half of an hour of direct labour.The standard labour rate is $15 per hour.In August, EKPN Co.Purchased 12,000 boards for a total cost of $123,000.It used 11,500 boards to manufacture 1,900 boxes.Total labour hours were 1,000 hours, and total labour costs were $16,250. What was the labour price variance?

• A)$1,250 U
• B)$1,250 F
• C)$4,250 F
• D)$4,250 U

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Definitions:

Import Quota

A government-imposed limit on the quantity or monetary value of a certain good that can be imported into the country.

World Price

The international market price of a good or service, determined through the global supply and demand.

Tariff Revenue

Income generated by the government from taxes imposed on imported goods, used as a tool for economic policy.

World Price

The global market cost of a good or service, shaped by worldwide demand and supply factors.