In Producing 700 Units of Product CBA Last Period, Cobalt

question 92

Essay

In producing 700 units of Product CBA last period, Cobalt Company used 5,000 pounds of Material H, costing $34,250. The company has established the standard of using 7.2 pounds of Material H per unit of CBA, at a price of $7.50 per pound.
(a) Calculate the materials price and quantity variances associated with producing the 700 units, and indicate whether they are favorable or unfavorable:
(b) Record the entry for the material used and related variances for Cobalt.
(c) Assume these variances are immaterial, prepare the entry to close them out at the end of the year.

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Definitions:

Optimization

The process of making something as fully perfect, effective, or functional as possible, often by using mathematical models or algorithms.

Equity

Fairness or justice in the way people are treated, often considered in contexts like economics, law, and social issues.

Efficiency

The extent to which resources such as time, energy, or materials are used well to achieve desired results, minimizing waste.

Observed Misconduct

Incidents or actions witnessed by an individual that violate ethical norms, laws, or organizational policies, potentially leading to harm or legal consequences.