The Porter Company Has a Standard Cost System

question 181

Multiple Choice

The Porter Company has a standard cost system.In July,the company purchased and used 22,500 kilograms of direct material at an actual cost of $53,000,the materials quantity variance was $1,875 unfavourable,and the standard quantity of materials allowed for July production was 21,750 kilograms.What was the materials price variance for July?

• A) $2,725 favourable.
• B) $2,725 unfavourable.
• C) $3,250 favourable.
• D) $3,250 unfavourable.

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Definitions:

Nonprogrammed Decisions

Decisions that are made in response to unique, non-routine, and unpredictable situations.

Cavanagh's Criteria Questions

A set of questions developed to assist in ethical decision-making by evaluating the legality, consistency with company values, and the likely impact of a decision on stakeholders.

Ethics

The principles and moral values that govern the behaviors and decision-making of individuals and organizations.

Decision-Making

The method of selecting options through recognizing a decision, collecting data, and evaluating different solutions.