The Alpha Company Produces Toys for National Distribution

question 66

Multiple Choice

The Alpha Company produces toys for national distribution. Standards for a particular toy are:

Materials: 12 grams per unit at 56?per gram.
Labour: 2 hours per unit at $2.75 per hour.

During the month of December, the company produced 1,000 units. Information for the month follows:

Materials: 14,000 grams were purchased and used at a total cost of $7,140.
Labour: 2,500 hours worked at a total cost of $8,000.


-What was the materials price variance?

• A) $420 favourable.
• B) $420 unfavourable.
• C) $700 favourable.
• D) $700 unfavourable.

---

Definitions:

Protestant Ethic

A concept which suggests that hard work, discipline, and frugality are a result of a person's subscription to the values espoused by the Protestant faith, commonly linked to capitalism's development.

Hard Work

The considerable effort and diligence applied to tasks or objectives, often seen as a virtue leading to success and achievement.

Prosperous Workers

Employees who are not only financially successful but also experience job satisfaction and personal fulfillment in their roles.

ERG Theory

A theory that organizes human needs into the categories of existence, relatedness, and growth.