The Following Direct Materials Data Pertain to the Operations of Wright

question 74

Essay

The following direct materials data pertain to the operations of Wright Co. for the month of December.
Standard materials price $5.00 per pound
Actual quantity of materials purchased and used 16,500 pounds
The standard cost card shows that a finished product contains 4 pounds of materials. The 16,500 pounds were purchased in December at a discount of 4% from the standard price. In December, 4,000 units of finished product were manufactured.
Instructions
Prepare a matrix for materials and calculate the materials variances.

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Definitions:

Control

The power to influence or direct people's behavior or the course of events, especially in the context of corporate governance or management.

Special Purpose Entities

Legal entities created by a parent company to isolate financial risk and conduct specific activities while protecting the parent company financially.

Primary Beneficiary

The main individual or entity designated to receive the benefits or payouts from an insurance policy, trust, or other financial instrument.

Consolidated

Referring to the financial statements that combine the financial information of a parent company with its subsidiaries to present as a single entity.