Machine Builders Inc. adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows:
The sales volume variance, measured in terms of direct labor cost, for July (to the nearest dollar) was:
Definitions:
Prenumbered Voucher
A control mechanism used in accounting to ensure that all transactions are recorded and processed in a sequential manner, mitigating errors and fraud.
Expenditure
Money spent or cost incurred in an organization's efforts to generate revenue, representing the cost of doing business.
Bank Reconciliation
The process of comparing a company's bank account balance as reported by the bank with the company's own records and reconciling any differences.
Deposit in Transit
Funds that have been sent to a bank but not yet recorded on the bank's records, often seen in bank reconciliation statements.
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