Canevari Corporation Makes a Product That Uses a Material with the Following

question 258

Multiple Choice

Canevari Corporation makes a product that uses a material with the following standards: The company budgeted for production of 1,300 units in April, but actual production was 1,200 units. The company used 3,750 kilos of direct material to produce this output. The company purchased 4,100 kilos of the direct material at a total cost of $8,610. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for April is:

• A)$315 F
• B)$300 U
• C)$300 F
• D)$315 U

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Definitions:

Incremental Analysis

A decision-making process used to evaluate the financial impacts of different choices, focusing on the costs and benefits that change between alternatives.

Special Price

A discounted or promotional pricing strategy applied to a product or service for a limited time or specific customers.

Variable Costs

Costs that vary directly with the level of production or business activity, such as raw materials and labor.

Fixed Costs

Expenses that remain constant in total regardless of changes in the level of business activity or output.