Standard Cost System-Disposition of Variances

question 85

Essay

Standard cost system-disposition of variances
The cost of goods sold at standard cost for Field Company for 2009 amounted to $425,000 and was 60% of net sales. As of the end of 2009, the total of balances remaining in cost variance accounts was a net unfavorable cost variance of $8,000, which is not considered material.
(a) What is the amount shown in Field 's 2009 income statement for cost of goods sold? $________________
(b) What is the amount reported in Field 's 2009 income statement for gross profit on sales? $________________

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity demanded.

Perfect Competitor

A market structure characterized by an infinite number of small firms, identical products, and free entry and exit, ensuring no single firm can influence market prices.

Industry-Wide Supply and Demand

The total quantity of goods and services that are available for purchase across an entire industry, alongside the total quantity that consumers are willing and able to buy within that industry.

Short-Run

A period in economics where at least one factor of production is fixed, and firms can't alter all inputs.