Miguez Corporation Makes a Product with the Following Standard Costs

question 371

Multiple Choice

Miguez Corporation makes a product with the following standard costs: The company budgeted for production of 2,600 units in September, but actual production was 2,500 units. The company used 5,440 liters of direct material and 1,680 direct labor-hours to produce this output. The company purchased 5,800 liters of the direct material at $7.20 per liter. The actual direct labor rate was $24.10 per hour and the actual variable overhead rate was $1.90 per hour.The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.The materials quantity variance for September is:

• A) $2,170 Unfavorable
• B) $2,232 Unfavorable
• C) $2,170 Favorable
• D) $2,232 Favorable

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Definitions:

Central Selling Point

A unique feature or benefit of a product or service that is emphasized to attract and convince potential customers.

Immediate, Personal Service

Prompt and individualized assistance tailored to meet specific needs of customers.

Welcoming Claims

Statements or assertions made with the intention of creating a friendly or hospitable environment.

Unethical Individuals

People who act in ways that violate moral principles or standards of conduct, often causing harm or disadvantage to others.