The Dexon Company Makes and Sells a Single Product, Called

question 76

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 use of direct materials in production,the general ledger would include what entry to the Materials Quantity Variance account?

• A) $900 debit.
• B) $900 credit.
• C) $3,600 debit.
• D) $3,600 credit.

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Definitions:

Mesenteric Vein

A vein that drains blood from the small intestine (and sometimes from the large intestine) into the portal vein of the liver.

Liver

An essential body organ that plays a crucial role in removing toxins, synthesizing proteins, and producing the biochemicals needed for digestion.

Intestines

The lower part of the digestive system where food is digested and absorbed into the body, comprised of the small and large intestines.