Cornell Company Had the Following Information Available for Its Specialty

question 72

Multiple Choice

Cornell Company had the following information available for its specialty product:
Standards for one unit of product:
Direct Materials: 5 pounds at $2 per pound
Direct Labor: 0.50 hour at $16 per hour
Materials and Labor Used to produce 8,500 units:
Direct Materials: 46,000 pounds at $3 per pound
Direct Labor: 4,000 hours at ? per hour
If the Direct Labor Price Variance is $4,600 Unfavorable,what is the actual labor rate per hour?

• A) $16.00
• B) $16.50
• C) $17.10
• D) $17.15

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Definitions:

Costs

The expenses involved in manufacturing a product or providing a service.

Benefits

Advantages or positive outcomes that result from a particular action or policy.

Cap-And-Trade

An environmental policy tool that sets a limit on emissions and allows companies to trade allowances for emissions as a way to reduce pollutants.

Pollutant Permits

Government-issued licenses allowing the holder to emit a certain amount of pollution; they can be bought and sold, creating an economic incentive for reducing emissions.