Neuhaus Corporation Manufactures One Product

question 344

Multiple Choice

Neuhaus Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: During the year, the company completed the following transactions:a. Purchased 52,900 gallons of raw material at a price of $7.60 per gallon.b. Used 46,820 gallons of the raw material to produce 27,600 units of work in process.Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation.
When the purchase of raw materials is recorded in transaction (a) above, which of the following entries will be made?

• A) $5,290 in the Materials Price Variance column
• B) ($5,290) in the Materials Price Variance column
• C) $5,290 in the Materials Quantity Variance column
• D) ($5,290) in the Materials Quantity Variance column

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Definitions:

Excellence

The quality of being outstanding or extremely good in some respect, often achieved through hard work and dedication.

Virtuous Activity

Engaging in actions that are in accordance with moral and ethical principles, often leading to personal and communal well-being.

Flourishing

pertains to achieving an optimal state of well-being, involving the realization of an individual's potential and the attainment of meaningful goals.

Golden Mean

The desirable middle ground or moderate path between two extremes, especially in Aristotle's ethical philosophy.