A Company Uses the Following Standard Costs to Produce a Single

question 171

Multiple Choice

A company uses the following standard costs to produce a single unit of output. $$\begin{array} { l l l } \text { Direct materials } & 6 \text { pounds at } \$ 0.90 \text { per pound } & = \$ 5.40 \\\text { Direct labor } & 0.5 \text { hour at } \$ 12.00 \text { per hour } & = \$ 6.00 \\\text { Manufactuning overhead } & 0.5 \text { hour at } \$ 4.80 \text { per hour } & = \$ 2.40\end{array}$$ During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month totaled
$56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400.
-Based on this information, the direct materials quantity variance for the month was:

• A) $5,800 favorable
• B) $5,800 unfavorable
• C) $1,000 favorable
• D) $1,800 favorable
• E) $1,800 unfavorable

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Definitions:

Illogical Thinking

A thought process that lacks reason, coherence, and often leads to conclusions not based on evidence or rationality.

Maladaptive

Behaviors or traits that are counterproductive to an individual's well-being or ability to meet the demands of life's situations and environments.

Bipolar Disorder

A psychological disorder marked by severe fluctuations in mood, ranging from manic or hypomanic states to depressive episodes.

Manic Episodes

Periods of abnormally elevated mood and high energy, often associated with bipolar disorder. Symptoms include inflated self-esteem, decreased need for sleep, and increased talkativeness.