Beakins Corporation Produces a Single Product

question 336

Multiple Choice

Beakins Corporation produces a single product. The standard cost card for the product follows: During a recent period the company produced 1,200 units of product. Various costs associated with the production of these units are given below: The company records all variances at the earliest possible point in time. Variable manufacturing overhead costs are applied to products on the basis of standard direct labor-hours. The labor rate variance for the period is:

• A)$3,150 U
• B)$2,700 F
• C)$2,700 U
• D)$3,150 F

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Definitions:

Average Total Cost

The sum of all production costs divided by the quantity of output produced, including both fixed and variable costs.

Deregulation

The process of reducing or eliminating government oversight and rules in various industries to foster a more free-market environment.

Efficiency Gains

Improvements in the use of resources that allow for more output without increasing the input.