The Standard Materials Cost to Produce 1 Unit of Product

question 54

Multiple Choice

The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a standard price of $50 per pound.In manufacturing 8,000 units,47,000 pounds of material were used at a cost of $51 per pound.What is the total direct materials cost variance?

• A)$48,000 unfavorable.
• B)$51,000 favorable.
• C)$51,000 unfavorable.
• D)$3,000 favorable.
• E)$3,000 unfavorable.

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Definitions:

Minimize Exposure

Taking steps to limit one's contact with potentially hazardous substances or situations to reduce risk of harm.

Negative Outcomes

Undesirable or harmful results or effects stemming from an action, decision, or situation.

Quality Procedures

Standardized methods and practices designed to ensure that products or services meet prescribed standards of quality.

Petty Cash Fund

A small amount of cash on hand used for covering minor expenses in an organization.