What Are Businesses Most Concerned with When Purchasing Raw Materials

question 142

Multiple Choice

What are businesses most concerned with when purchasing raw materials?

• A) price and service
• B) quantity and brand
• C) image
• D) customization

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Definitions:

Labour Rate Variance

The difference between the actual cost of direct labor and the estimated cost based on the standard labor rate.

Standard Labour Hours

The calculated amount of labor hours predetermined to be necessary for completing a specific task or producing a certain quantity of goods.

Actual Hours Worked

The real number of hours an employee or workforce spends performing tasks during a specific period, as opposed to scheduled or standard hours.

Materials Price Variance

The difference between the actual cost of materials used in production and the standard (expected) cost.