Rogstad Corporation Manufactures and Sells a Single Product

question 19

Multiple Choice

Rogstad Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 6,700 units, but its actual level of activity was 6,670 units. The company has provided the following data concerning the formulas to be used in its budgeting: The activity variance for direct labor in March would be closest to:

• A) $2,406 U
• B) $216 U
• C) $216 F
• D) $2,406 F

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Definitions:

Par Stock

A standard inventory level that a business aims to maintain to ensure adequate supplies are available to meet demand without holding excessive stock.

Stock Split

A corporate action where a company divides its existing shares into multiple shares to boost the liquidity of the shares, while maintaining the same total valuation.

Contributed Capital

Funds received by a company from selling its stock to investors, representing the investors' ownership stake in the company.

Par Value

The nominal value of a bond or stock as declared by the issuer, which may not correspond with its value on the market.