Vashon Corporation Had the Following Activity During a Recent Period

question 150

Multiple Choice

Vashon Corporation had the following activity during a recent period: Standard quantity of direct materials 9,000 kilograms
Actual quantity of direct materials purchased and used 8,800 kilograms
Efficiency variance $2,400 favourable
Total direct materials budget variance $200 favourable
The standard price per kilogram was:

• A)$12.00
• B)$12.25
• C)$12.50
• D)$13.00

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Definitions:

Standard Material

A benchmark or norm for the quality and type of materials used in the production of goods, aiding in cost control and budgeting.

Service Company

A business that provides services to consumers or other businesses rather than manufacturing goods.

Planning Budget

A budget established at the beginning of the budgeting period that is valid only for the planned level of activity.

Net Operating Income

A financial metric that calculates a company's profit after operating expenses are subtracted but before income taxes and interest are deducted.