Galla Corporation Makes a Product with the Following Standard Costs

question 292

Multiple Choice

Galla Corporation makes a product with the following standard costs: The company budgeted for production of 2,400 units in June, but actual production was 2,500 units. The company used 19,850 pounds of direct material and 980 direct labor-hours to produce this output. The company purchased 21,700 pounds of the direct material at $6.70 per pound. The actual direct labor rate was $19.20 per hour and the actual variable overhead rate was $1.80 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for June is:

• A)$4,550 U
• B)$4,355 F
• C)$4,550 F
• D)$4,355 U

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Definitions:

Ecological Perspective

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