Assume the Following Information for Petra Sales Company: • Common

question 99

Multiple Choice

Assume the following information for Petra Sales Company: • Common stock, $1.00 par, 200,000 issued, 180,000 outstanding
• Paid-in capital in excess of Par-Common: $1,600,000
• Retained earnings: $2,440,000
• Treasury stock: 20,000 shares purchased at $12 per share
If Petra Sales purchases an additional 5,000 shares of treasury stock at $14 per share, what number of shares will be shown as issued and outstanding?

• A)175,000 issued; 180,000 outstanding
• B)195,000 issued; 180,000 outstanding
• C)200,000 issued; 175,000 outstanding
• D)200,000 issued; 180,000 outstanding

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Definitions:

Fixed Overhead Volume Variance

The difference between the budgeted and actual fixed overhead costs attributed to the variation in produced units.

Materials Price Variance

The difference between the actual cost of materials and the standard cost, which can indicate inefficiencies or savings.

Direct Labor Rate Variance

The difference between the expected cost of direct labor at standard rates and the actual cost incurred.

Fixed Manufacturing Overhead

Costs that do not vary with the level of production output, including expenses such as factory rent, salaries of manufacturing personnel, and property taxes on manufacturing facilities.