The Purchasing Manager Was Able to Bring Down the Cost

question 103

Multiple Choice

The purchasing manager was able to bring down the cost of direct materials by purchasing direct materials of a slightly lower grade quality than the company had used previously.The lower grade of direct materials,however,meant a higher defect rate on the assembly line and higher wastage of direct materials during production,which in turn lowered operating income.This situation would lead to a(n) ________.

• A) favorable direct materials cost variance
• B) unfavorable direct labor cost variance
• C) favorable direct labor efficiency variance
• D) favorable direct materials efficiency variance

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Definitions:

1947

The year notable for numerous historical events, including the partition of India, the beginning of the Cold War, and the establishment of the CIA in the United States.

British

Pertaining to anything of, relating to, or characteristic of Great Britain or its people, culture, and language.

Lotus Mahal

An architectural marvel located in Hampi, India, known for its blend of Hindu and Islamic styles, resembling a lotus flower.

Sacred Center

A term referring to a place considered holy or central to a particular religion or belief system, often marked by a significant religious or spiritual monument.