Machine Builders Inc

question 164

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: materials: 4 kilograms/unit x $10.00 per kilogram = $40.00/unit;labor: 4 hours/unit x $18.00 per hour = $72.00/unit.All materials are issued at the beginning of processing.The operating data shown below were taken from the records for July:
The direct materials usage variance for July was:

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

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