The Standard Price and Quantity of Direct Materials Are Separated

question 39

Multiple Choice

The standard price and quantity of direct materials are separated because:

• A) GAAP reporting requires this separation
• B) direct materials prices are controlled by the purchasing department, and quantity used is controlled by the production department
• C) standard quantities are more difficult to estimate than standard prices
• D) standard prices change more frequently than standard quantities

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Definitions:

Consumer Transaction

Any transaction between a seller and a buyer for goods or services intended for personal, family, or household use.

Real Property

Pertains to land and anything permanently attached to it, including buildings and structures.

Right to Revoke Acceptance

A legal prerogative under certain conditions allowing a buyer to cancel a contract after having previously accepted goods or services.

Additional Advertising Fees

Fees charged in addition to a base rate or cost, specifically for promotional or marketing activities.