During the Month of December, Cakers Express Purchased 20,000 Kg

question 118

Multiple Choice

During the month of December, Cakers Express purchased 20,000 kg of flour at $2 per kilogram.
-Refer to the Figure.At the end of December,Cakers Express found that it had a favourable materials price variance of $1,000.What is the flour's standard cost per kilogram?

• A)$0.95
• B)$1.00
• C)$1.05
• D)$1.95

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Definitions:

Cost

The cost involved in buying an item or the financial outlay needed to produce a good or service.

Mark-up

The amount added to the cost price of goods to cover overhead and profit, expressed as a percentage of the cost.

Markdown

A reduction from the original or listed price of a good or service, often used to stimulate sales or clear out inventory.

Gross Profit

The financial term for the difference between revenue and the cost of goods sold, before deducting overheads, payroll, taxation, and interest payments.