Pat Realized a Total Return of 13

question 50

Multiple Choice

Pat realized a total return of 13.2%, which is more than his expected return of 12.5%. What is the amount of his unexpected return?

• A)−1.4%
• B)−.7%
• C).7%
• D)1.4%
• E)1.8%

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Definitions:

Variable Overhead

Refers to the indirect costs of operation that fluctuate with the level of production activity, such as utilities for manufacturing facilities.

Labor Rate Variance

The difference between the actual cost of labor and the expected (or standard) cost, indicating efficiency or inefficiency in labor usage.

Direct Labor

Direct labor involves the work of employees that is directly attributable to the production of goods or provision of services, such as manufacturing labor costs.

Materials Price Variance

The deviation between the actual cost of direct materials and the standard cost, multiplied by the quantity purchased.