Roberts Company Uses a Standard Costing System

question 117

Multiple Choice

Roberts Company uses a standard costing system. The following information pertains to direct materials for the July: Roberts Company reports its material price variances at the time of purchase. What is the material usage variance for Roberts Company?

• A) $900 F
• B) $1,950 F
• C) $2,850 F
• D) $900 U

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Definitions:

Extraction Costs

The expenses associated with the removal of natural resources from the earth, such as mining for minerals or drilling for oil.

Nonrenewable Resource

A natural resource that cannot be replaced once it has been used or is not replenished in a short period of time, such as fossil fuels and minerals.

Removal

The process of moving or eliminating something from a certain place or context.

User Cost

The cost of using a good or service, considering both the expense of use and the opportunity cost of not using an alternative.