Accurate Tax Returns Budgets Two Direct Labor Hours for Every

question 93

Multiple Choice

Accurate Tax Returns budgets two direct labor hours for every tax return that it prepares,at a standard cost of $32 an hour.During the most recent year,500 returns were completed with the labor cost totaling $18,000.The actual labor cost was $36 per hour during that period.The actual number of labor hours was 1,000.What was the direct labor cost variance?

• A)$2,000 F
• B)$32,000 U
• C)$4,000 U
• D)$32,000 F

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Definitions:

Adjusting Entries

Journal entries made at the end of an accounting period to allocate revenue and expenses to the period in which they actually occurred.

Accounts

Records within an accounting system that are used to store and summarize transactions related to specific assets, liabilities, equity, revenue, and expenses.

Financial Statements

Reports that summarize the financial performance and position of a company, including the balance sheet, income statement, and cash flow statement.

Trial Balance

A bookkeeping report that lists the balances of all ledgers and accounts to check that debits equal credits.