Cibolo Company
Cibolo Company Has the Following Information Available for March

question 187

Multiple Choice

Cibolo Company
Cibolo Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar) .
$\begin{array}{ll}\text { Standards: } &4.0 \text { pounds } \\\text { Material } & \text { per unit @ } \\& \$ 5.25 \text { per } \\& \text { pound } \\& 6.0 \text { hours } \\\text { Labor } & \text { per unit @ } \\& \$ 10.00 \text { per } \\& \text { hour }\end{array}$

$\begin{array}{ll}\text { Actual: } & \\\text { Material purchased } & 17,500 \\& \text { pounds } @ \\& \$ 5.10 \\\text { Material used } & 16,700 \\& \text { pounds } \\25,500 \text { direct1abor hours @ } &\end{array}$
$\$9.85 \text { per hour }$









Refer to Cibolo Company.What is the labor efficiency variance?

• A)$ 2,955 F
• B)$ 2,955 U
• C)$ 3,000 U
• D)$ 3,000 F

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Definitions:

Depreciated

The method of distributing the expense of a physical asset across its lifespan, indicating its diminishing value as time passes.

Depletion

The allocation of the cost of natural resources over their useful life.

Mining Company

A company involved in the extraction of minerals, metals, or other geological materials from the earth.

Mineral Rights

Legal entitlements allowing the holder to explore, extract, and sell mineral resources from a piece of land.