A Company Provided the Following Direct Materials Cost Information $\text {Standard costs assigned:}$

question 106

Multiple Choice

A company provided the following direct materials cost information. Compute the direct materials quantity variance. $\text {Standard costs assigned:}$
$\begin{array}{llr} \text {Direct materials standard cost \( (405,000 \) units @\$2.00/unit) } & \$ 810,000\\ \text { Actual costs:} &\\ \text {Direct Materials costs incurred ( 403,750 units@\$2.20/unit) } &\$ 888,250 \end{array}$

• A) $78,250 Favorable.
• B) $2.500 Favorable.
• C) $2,750 Unfavorable
• D) $2,500 Unfavorable.
• E) $2,750 Favorable.

---

Definitions:

Market Share

The portion of a market controlled by a particular company, product, or brand, often expressed as a percentage of total sales.

Competitors

Other businesses or individuals that offer similar products or services within the same market.

Variable Costs

Costs that change in proportion with the level of output or activity.

Fixed Costs

Costs that do not change with an increase or decrease in the amount of goods or services produced or sold.