Use the Following Data to Determine the Total Amount of Working

question 138

Multiple Choice

Use the following data to determine the total amount of working capital.

• A) $404,000
• B) $234,000
• C) $254,000
• D) $174,000

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Definitions:

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity levels.

Direct Materials Quantity Variance

The difference between the actual quantity of direct materials used in production and the standard quantity expected to be used, multiplied by the standard cost per unit.

Direct Material Price Variance

The difference between the actual cost of direct materials and the standard cost multiplied by the quantity purchased, used in variance analysis for cost control.

Actual Price Per Pound

The real cost of a commodity or material expressed on a per pound basis.