The Snowman Company Makes Mugs for Which the Following Standards

question 37

Multiple Choice

The Snowman Company makes mugs for which the following standards have been developed: Production of 400 mugs was expected in July,but 440 mugs were actually completed.Direct materials purchased and used were 2,100 ounces at an actual price of $2.20 per ounce.Direct labor cost for the month was $5,310,and the actual pay per hour was $10.00.What is the standard direct material cost for each mug produced?

• A)$9.00
• B)$10.00
• C)$13.20
• D)$32.00

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Definitions:

Opportunity Cost

The fiscal consequence of excluding the next most beneficial alternative from consideration during decision-making.

DVDs

Digital Versatile Discs, a type of optical storage media used for storing video, audio, and data in digital format.

Books

Published works consisting of written, printed, or blank pages fastened together and bound in covers.

Normative Statements

Statements that express opinions about how the world ought to be, involving subjective judgments or prescriptions for economic policies.