Answer the Following Questions Using the Information Below:
Hunter Valley

question 185

Multiple Choice

Answer the following questions using the information below:
Hunter Valley Orchards (HVO) ,developed standard costs for direct material and direct labour.In 2018,HVO estimated the following standard costs for one of their most well-loved products,the HVO 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.
$$\begin{array} { l l l } & \text { Budgeted quantity } & \text { Budgeted price } \\\text { Direct materials } & 1.5 \mathrm {~kg} & \$ 7.25 \text { per } \mathrm { kg } \\\text { Direct labour } & 0.25 \text { hours } & \$ 14.00 \text { per hour }\end{array}$$ During September,HVO produced and sold 1200 pies using 1875 kg of direct materials at an average cost per kg of $7.00 and 280 direct labour hours at an average wage of $14.25 per hour.
-September's direct labour price variance is:

• A)$70.00 favourable.
• B)$210.00 favourable.
• C)$70.00 unfavourable.
• D)$210.00 unfavourable.

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Definitions:

Sales Commission

A fee paid to sales personnel, often calculated as a percentage of the sales they generate.

Income Tax

A tax imposed by a government on the financial income generated by individuals or entities within its jurisdiction.

Plant Capacity

The maximum level of output that a company can sustain to produce in a given period under normal conditions.

Opportunity Cost

The cost of foregoing the next best alternative when making a decision, representing the benefits one misses out on when choosing one option over another.