The Dexon Company Makes and Sells a Single Product, Called

question 79

Multiple Choice

The Dexon Company makes and sells a single product, called a Mip, and employs a standard costing system. The following standards have been established for one unit of Mip: $\begin{array}{|l|r|r|}\hline & \text { Standard Quantity or Hours } & \text { Standard Cost per Mip } \\\hline \text { Direct Materials } & 6 \text { board metre } & \$ 9.00 \\\hline \text { Direct Labour } & 0.8 \text { hours } & \$ 9.60 \\\hline\end{array}$
There were no inventories of any kind on August 1. During August, the following events occurred:
Purchased 15,000 board metres at the total cost of $\$ 24,000$ .
Used 12,000 board metres to produce 2,100 Mips.
Used 1,700 hours of direct labour time at a total cost of $\$ 20,060$ .
- To record the incurrence of direct labour cost and its use in production,the general ledger would include what entry to the Labour Rate Variance account?

• A) $240 credit.
• B) $240 debit.
• C) $340 debit.
• D) $340 credit.

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Definitions:

Unconventional

Unconventional refers to something that does not follow traditional or expected norms, methods, or practices.

Illogical

Lacking in sound reasoning or coherent argumentation, often leading to conclusions or actions that defy rational thought.

Ambiguous

Open to more than one interpretation or having a double meaning.

Emotions

Complex psychological states involving an individual's physiological response, subjective experience, and behavioral expression in response to stimuli.