Figure 6-1

question 31

Multiple Choice

Figure 6-1.The following information is available for Department Z for the month of July:
Materials are added at the beginning of the process. (Round unit costs to two decimal places.)
-Refer to Figure 6-1. Department Z's cost of ending work in process using the FIFO method would be

• A) $3,960.
• B) $3,552.
• C) $3,500.
• D) $3,160.

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Definitions:

Budget Variance

The difference between the actual fixed overhead costs and the budgeted fixed overhead costs for the period.

Applied

Refers to the process of allocating or assigning costs to a specific cost object in a manner that is consistent with the usage or benefits derived from it.

Denominator Activity Level

A term used in cost accounting to represent the total activity or volume that is used to allocate fixed costs to units of output.

Standard Cost System

A cost accounting system that uses cost units determined in advance for materials, labor, and overhead to estimate the cost of production.