The Collins Corporation Uses Standard Costing and Has Established the Following

question 40

Multiple Choice

The Collins Corporation uses standard costing and has established the following direct material and direct labor standards for each unit of the single product it makes: • Direct materials: 4 gallons at $8 per gallon
• Direct labor: 1 hour at $16 per hour
During July, the company made 6,000 units of product and incurred the following costs:
• Direct materials purchased: 26,800 gallons at $8.20 per gallon
• Direct materials used: 25,200 gallons
• Direct labor used: 5,600 hours at $15.30 per hour
The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for July was:

• A)$3,920 Unfavorable
• B)$6,120 Unfavorable
• C)$1,120 Favorable
• D)$3,920 Favorable

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Definitions:

Individualist

A person with a preference for independence and self-reliance, prioritizing their own goals and self-expression over group goals.

Universal Emotion

Basic emotions that are experienced by all humans across cultures, such as happiness, sadness, fear, disgust, anger, and surprise.

Security Motivation

A psychological state driving individuals to pursue safety and security in their environment and relationships.

Growth Motivation

The drive to enhance oneself, learn new things, and effectively meet challenges.