Fletcher Company Collected the Following Data Regarding Production of One

question 116

Multiple Choice

Fletcher Company collected the following data regarding production of one of its products. Compute the direct materials quantity variance. $$\begin{array} { l rl} \text { Direct materlals stardard (6lbs. @ \$2/16.) } & \$ 12 & \text { per finished unit } \\\text { Actual direct materials used } & 243,000 & \text { lbs. } \\\text { Actual finished units produced } & 40,000 & \text { units }\\\text { Actual cost of direct materials used}&\$483,570\\\end{array}$$

• A) $2,430 unfavorable.
• B) $3,570 unfavorable.
• C) $2,430 favorable.
• D) $6,000 unfavorable.
• E) $3,570 favorable.

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Definitions:

Standards Gap

The difference between existing standards and the newly established benchmarks that need to be met, often leading to a period of adjustment for organizations.

Knowledge Gap

The difference in understanding, information, or knowledge between individuals, groups, or data sets.

Zone of Tolerance

The range of service levels between the desired and adequate performance levels of customers, within which customers are willing to accept variations in service quality.

Service Delivery

The act of providing a service to customers or clients, encompassing the processes and interactions to meet their needs.