-Refer to Figure 7-7

question 229

Multiple Choice

-Refer to Figure 7-7. When output level is 100, what is the total cost of production?

• A) $20
• B) $1000
• C) $1200
• D) $2000

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Definitions:

Total Direct Labor Cost Variance

The difference between the actual direct labor costs incurred and the standard or expected direct labor costs.

Direct Labor Costs

Direct labor costs are the total amounts paid to employees directly involved in production, such as wages for hours worked on manufacturing goods.

Total Direct Labor Cost Variance

The difference between the actual labor costs incurred and the standard labor costs expected for the actual level of production. It is used to measure efficiency in production processes.

Direct Labor

Direct Labor involves the wages paid to workers who are directly involved in the production of goods or the delivery of services, being a variable cost tied to production levels.