Calculate the Total Direct Materials Cost Variance Using the Above

question 68

Multiple Choice

Calculate the Total Direct Materials cost variance using the above information:

• A) $9,262.50 Unfavorable
• B) $9,262.50 Favorable
• C) $3,780.00 Unfavorable
• D) $3,562.50 Favorable

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Definitions:

Break-even Units

The number of units a company must sell to cover all its costs, with no profit or loss.

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as materials or labor directly involved in producing a product.

Selling Price

The amount of money charged for a product or service, or the sum for which something is offered for sale.

Profit Increase

A financial metric indicating an augmentation in a company's earnings over a specific period.