Answer the Following Questions Using the Information Below

question 118

Multiple Choice

Answer the following questions using the information below:
Apple Valley Orchards, Inc. (AVO) , developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of their most well loved products, the AVO classic Grandma's large apple pie which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples.
During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour.
-September's direct material efficiency variance is:

• A)$468.75 favorable
• B)$468.75 unfavorable
• C)$543.75 favorable
• D)$543.75 unfavorable

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Definitions:

Recording Process

The systematic method of capturing, documenting, and maintaining financial transactions and events in the accounting records of an organization.

Ledger Accounts

Individual accounts within the ledger that record transactions related to a company's assets, liabilities, equity, revenue, and expenses.

Journal

A detailed record where all financial transactions of a business are initially recorded before being transferred to the accounts in the general ledger.

Transaction Recording Process

The methodical process of recording financial transactions in the books of accounts to ensure accurate financial reporting.