Bohon Corporation Manufactures One Product

question 104

Multiple Choice

Bohon Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product contains the following information concerning direct materials:
During the year, the company completed the following transactions concerning direct materials:
a. Purchased 19,700 pounds of raw material at a price of $4.70 per pound.
b. Used 18,500 pounds of the raw material to produce 18,400 units of work in process.
The company calculated the following direct materials variances for the year:
Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation.

-When the purchase of raw materials is recorded in transaction (a) above,which of the following entries will be made?

• A) $15,760 in the Materials Quantity Variance column
• B) ($15,760) in the Materials Price Variance column
• C) ($15,760) in the Materials Quantity Variance column
• D) $15,760 in the Materials Price Variance column

---

Definitions:

Walnut

A type of nut obtained from trees of the genus Juglans, known for its hard shell and edible seed.

Primary Reinforcer

Something that is naturally rewarding, such as food or drink, that does not require any learning to be considered pleasurable.

Sandwich

A food item typically consisting of two pieces of bread with meat, cheese, vegetables, or other fillings in between.

Praise

The expression of approval or admiration for someone or something.