Machine Builders Inc

question 39

Multiple Choice

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 direct materials usage variance for July, to the nearest dollar, was:

• A) $3,000 favorable.
• B) $43,000 favorable.
• C) $12,000 unfavorable.
• D) $15,000 unfavorable.

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Definitions:

Economic Activity

Actions that involve the production, distribution, and consumption of goods and services at all levels within a society.

Exclusive Distribution Rights

These are rights granted usually by a manufacturer to a distributor, allowing them to be the only ones to sell a specific product in a particular area or market.

Reseller

A company or individual that purchases goods or services with the intention of selling them rather than consuming or using them.

Reseller Firms

Companies that purchase goods or services with the intention of reselling them rather than consuming or using them.