Sheldon Company Manufactures Only One Product and Uses a Standard

question 70

Multiple Choice

Sheldon Company manufactures only one product and uses a standard cost system.During the past month,the manufacturing operations had the following variances: Direct labor rate variance $30,000 Favorable.Direct labor efficiency variance 50,000 Unfavorable Sheldon allows 5 standard direct labor hours per unit produced,and its standard direct labor hourly rate is $50.During the month,the company used 25 percent more direct labor hours than the standard allowed.How many units of the product were produced during the past month?

• A)800.
• B)1,000.
• C)1,200.
• D)1,500.
• E)2,000.

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Definitions:

Prevention Cost

The costs incurred to prevent defects in products or services, including costs related to quality planning, training, and process control.

Vendor Quality

Vendor quality encompasses the ability of a supplier to deliver goods or services that meet the buyer's requirements, including the standards for materials, processes, and final product.

Prevention Cost

Costs incurred to prevent defects in products or services, including training, quality control, and equipment maintenance.

Internal Failure Cost

Costs associated with defects found before a product or service is delivered to the customer, such as scrap and rework expenses.