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

Recognize the enforceability of oral agreements under specific conditions.

Understand the significance of industry standards and practices in interpreting or completing contracts.

Differentiate between the requirements and exceptions of the statute of frauds in the U.S. and England.

Understand the concept of performance and its effect on the statute of frauds.

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Definitions:

Inventory Shrinkage

The loss of products between the point of manufacture or purchase from suppliers and the point of sale, often due to theft, damage, or errors.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred.

Inventory

The complete stock of goods and raw materials a company maintains for purposes of resale or to be used in the creation of products.

Gross Method

An accounting method for recording purchases at the full invoice price without deducting any cash discounts.