) Saskatoon Company Uses Two Raw Materials, a and B

question 232

Multiple Choice

) Saskatoon Company uses two raw materials, A and B, in the manufacture of its only product: Zizbo. The materials are very close substitutes. The standard proportions for the manufacture of a unit of Zizbo are 2 units of A and 3 units of B. The unit standard prices of A and B are $10 and $8, respectively. During the month of August, the company used 450 units of A and 750 units of B to produce 230 units of Zizbo.
-Which one of the following variances is MOST controllable by a production supervisor?

• A) Materials price variance.
• B) Materials quantity variance.
• C) Fixed overhead volume variance.
• D) Variable overhead spending variance.

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