Leonesio Corporation Makes a Product That Uses a Material with the Following

question 224

Multiple Choice

Leonesio Corporation makes a product that uses a material with the following standards:
The company budgeted for production of 3,100 units in August, but actual production was 3,200 units. The company used 27,600 kilos of direct material to produce this output. The company purchased 29,000 kilos of the direct material at a total cost of $118,900. The direct materials purchases variance is computed when the materials are purchased.
-The materials quantity variance for August is:

• A) $5,576 F
• B) $5,576 U
• C) $5,440 F
• D) $5,440 U

Calculate and interpret the Days' Cash on Hand ratio.

Understand the establishment and replenishment of a petty cash fund.

Recognize the importance of maintaining a minimum cash balance (compensating balances).

Understand the objectives and implementation of internal control systems.

---

Definitions:

Absolute Forbiddance

The strict prohibition or banning of certain actions, behaviors, or substances without exceptions.

Preferred Form

The most accepted or favored version or configuration of something, often reflecting cultural, aesthetic, or functional superiority.

Elaborate Designs

Refers to complex and detailed patterns or structures, often used in architecture, fashion, and art.

Smallest Family Unit

The most basic social group in society, typically consisting of parents and their children; this is synonymous with the nuclear family.