Cole Laboratories Makes and Sells a Lawn Fertilizer Called Fastgro

question 56

Multiple Choice

Cole Laboratories makes and sells a lawn fertilizer called Fastgro. The company has developed standard costs for one bag of Fastgro as follows:
$\begin{array}{|l|r|r|}\hline & \text { Standard Quantity } & \text { Standard Cost per Bag } \\\hline \text { Direct Materials } & 20 \text { kilograms } & \$ 8.00 \\\hline \text { Direct Labour } & 0.1 \text { hours } & 1.10 \\\hline \text { Variable Manufacturing Overhead } & 0.1 \text { hours } & .40\\\hline \end{array}$
The company had no beginning inventories of any kind on January 1. Variable manufacturing overhead is applied to production on the basis of direct labour hours. The results of the company's operations during January are as follows:
$\begin{array}{|l|r|}\hline \text { Production of Fastgro: } & 4,000 \text { bags } \\\hline \text { Direct Materials Purchased } & 85,000 \text { kilograms at a cost of } \$ 32,300 \\\hline \text { Direct Labour Used } & 390 \text { hours at a cost of } \$ 4,875 \\\hline \text { Variable Manufacturing Overhead Incurred } & \$ 1,475 \\\hline \text { Inventory of Direct Materials on January } 31 & 3,000 \text { kilograms } \\\hline\end{array}$
-What was the materials price variance for January?

• A) $1,300 unfavourable.
• B) $1,640 favourable.
• C) $1,640 unfavourable.
• D) $1,700 favourable.

---

Definitions:

Nature vs. Nurture

A discussion about how much of a person's physical and behavioral characteristics are determined by genetic makeup compared to their life experiences.

Aggression

Behavior intended to harm or injure another being, whether physically or psychologically.

Hormonal Control

The regulation of bodily functions and processes by hormones, which are chemical messengers produced by glands in the endocrine system.

Reproductive System

A biological system comprising organs and structures used in the production of offspring.