Devon Company Has Collected the Following Data for One of Its

question 57

Multiple Choice

Devon Company has collected the following data for one of its products: $$\begin{array} { | l | l | } \hline \text { irect materials standard (3 pounds } @ \$ 1 / \mathrm { lb } \text {.) } & \$ 3 \text { per unit } \\\hline \text { Direct materials flexible budget variance - unfavorable } & \$ 15,500 \\\hline \text { Actual direct materials used } & 101,000 \text { pounds } \\\hline \text { Actual units produced } & 18,000 \text { units } \\\hline\end{array}$$ What is the direct materials efficiency variance?

• A) $18,000 U
• B) $47,000 F
• C) $47,000 U
• D) $18,000 F

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Definitions:

Cashier's Check

A check issued by a bank, drawn on its own funds rather than the account of a private individual, offering a high level of guarantee of payment.

Bank

A banking entity authorized to accept deposits, extend credit, and offer diverse financial services to both private individuals and commercial entities.

Authorization to Confess Judgment

A legal provision where a debtor gives a creditor the right to enter a judgment against them without trial if they fail to meet the terms of an agreement.

Negotiability

This term refers to the characteristic of a financial instrument that enables it to be transferred or assigned from one party to another with ease and legal effect.