The Standard Costs and Actual Costs for Direct Materials for the Manufacture

question 63

Multiple Choice

The standard costs and actual costs for direct materials for the manufacture of 2,500 actual units of product are as follows: The amount of the direct materials quantity variance is:

• A) $875 favorable
• B) $800 unfavorable
• C) $800 favorable
• D) $875 unfavorable

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Definitions:

Monetary Assets

Assets that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value.

Foreign Currency Transactions

Financial transactions involving the exchange of one country's currency for another's, impacting businesses and investors who operate internationally.

Exchange Rate

The price at which one currency can be exchanged for another.

Noncontrolling Shareholders

Shareholders who own a minority of a company's shares and thus have limited influence on corporate decisions.