Glue for All Has Developed the Following Material Standard to Produce

question 61

Multiple Choice

Glue For All has developed the following material standard to produce one container of Glue-It: 96 ounces of Chemical A at $0.15 per ounce.Glue For All planned to produce 2,000 containers of Glue-It during July.The company purchased 1,500 gallons (192,000 ounces) of Chemical A at a cost of $0.14 per ounce in July.The company used 1,480 gallons to produce 1,950 containers of Glue-It.How much is the material price variance?

• A)$1,920 favorable
• B)$1,894 favorable
• C)$336 unfavorable
• D)$1,584 unfavorable

---

Definitions:

Last Year's Margin

The difference between sales revenue and cost of goods sold from the previous financial year, typically expressed as a percentage of sales.

Division's Turnover

The total revenue generated by a specific division of a company within a given period.

Last Year's Turnover

The total sales or revenues generated by a company during the previous year.

Net Operating Income

The profit generated from a company's usual business operations, excluding taxes and interest.