Mason, Inc

question 102

Multiple Choice

Mason, Inc. uses a standard costing system. Overhead costs are allocated based on direct labour hours. The standard variable overhead and fixed overhead rates are $1 and $5 per direct labour hour, respectively. Data relevant for the current period include: Direct materials purchased 50,000 kg. @ $12 per kg.
Direct materials used 50,000 kg.
Standard quantity of direct materials
For actual production 45,000 kg.
Direct materials standard price $13 per kg.
Direct labour costs incurred 75,000 hours @ $12 per hour
Standard direct labour hours for
Actual production 78,000 hours
Standard direct labour cost per hour $11 per hour
Variable overhead costs incurred $77,070
Fixed overhead costs incurred $381,920
The direct labour price variance is:

• A)$30,000 Favourable
• B)$30,000 Unfavourable
• C)$75,000 Unfavourable
• D)$78,000 Unfavourable

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Definitions:

Kohlberg Construct

A theoretical framework concerning the stages of moral development formulated by psychologist Lawrence Kohlberg.

Personal Ethics

The principles that an individual considers in distinguishing right from wrong and in making decisions based on these principles.

Management Team

A group of individuals at the top of an organization who coordinate their efforts to achieve strategic and operational goals.

Self-Interest

The consideration of one's own advantage or benefit, often as a motivation for actions in a business or economic context.