Midend's Camera Shop Has Prepared the Following Flexible Budget for September

question 78

Multiple Choice

Midend's Camera Shop has prepared the following flexible budget for September and is in the process of interpreting the variances.F denotes a favorable variance and U denotes an unfavorable variance.

The actual amount spent for Material A was ________.

• A)$30,200
• B)$26,200
• C)$27,800
• D)$23,800

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Definitions:

Direct Labor Rate Variance

The variance between the real expense of direct labor and its anticipated (or standard) price, employed in analyzing manufacturing costs.

Actual Costs

The actual expenses incurred in the production of goods or services, including all direct and indirect costs.

Standard Costs

Predetermined costs for materials, labor, and overhead used as targets for controlling production costs.

Direct Materials Price Variance

The difference between the actual cost and the standard cost of direct materials used in production.