The Standard Cost of Direct Material Is the

question 142

Multiple Choice

The standard cost of direct material is the

• A)standard price of direct material input × standard quantity of direct material inputs.
• B)standard price of direct material input × actual quantity of direct material inputs.
• C)actual price of direct material input × standard quantity of direct material inputs.
• D)actual price of direct material input × actual quantity of direct material inputs.

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Definitions:

Consumption

The total value of goods and services consumed by households and businesses.

APC

Average Propensity to Consume, the fraction of total disposable income that households plan to spend on consumption as opposed to saving.

Income

The financial gain accrued by an individual or entity within a specified period, often through wages, salaries, or investments.

APC

Usually refers to Average Propensity to Consume, which is the fraction of income spent on consumption rather than saved.