Use the Following Information for Questions

question 144

Multiple Choice

Use the following information for questions
Oxnard Industries produces a product that requires 2.6 pounds of materials per unit. The allowance for waste and spoilage per unit is .3 pounds and .1 pounds, respectively. The purchase price is $2 per pound, but a 2% discount is usually taken. Freight costs are $.10 per pound, and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00 per hour, but a raise which will average $.30 will go into effect soon. Payroll taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard production time is 1 hour per unit, and the allowance for rest periods and setup is .2 hours and .1 hours, respectively.
-The standard direct labor rate per hour is

• A) $ 12.00.
• B) $ 12.30.
• C) $15.60.
• D) $15.90.

---

Definitions:

Sales Revenue

The income that a company receives from its normal business activities, usually from the sale of goods and services to customers.

Accounts Payable

Liabilities to creditors, representing amounts the company owes for goods and services it has received but not yet paid for.

Note Receivable

A financial asset representing a written promise to receive a specific amount of money, plus interest if applicable, by a certain date.

Dishonored

A term used when an instrument such as a check is not accepted or paid upon presentation.