During November,10,000 Units Were Produced

question 25

Multiple Choice

During November,10,000 units were produced.The standard quantity of material allowed per unit was 10 kg at a standard cost of $3 per kilogram.Suppose the company had an unfavourable usage variance of $18,750 for November.What would have been the actual quantity of materials used?

• A)23,438 kg
• B)31,875 kg
• C)93,750 kg
• D)106,250 kg

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Definitions:

Unit Variable Cost

The cost associated with producing an additional unit of product, which includes materials, labor, and any other expenses that increase with each unit produced.

Monthly Sales

The total revenue generated from sales of goods or services within a month.

Net Operating Income

The total profit of a company after operating expenses are deducted but before taxes and interest are subtracted.

Break-even Point

The level of sales at which total costs equal total revenue, resulting in no net profit or loss.