Galla Corporation Makes a Product with the Following Standard Costs

question 147

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 price variance for June is:

• A)$6,150 F
• B)$6,150 U
• C)$6,510 F
• D)$6,510 U

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Definitions:

Task System

A labor system in which enslaved individuals were assigned a particular task to complete each day, after which they had some control over their time.

Work Stoppages

Events or occurrences where employees cease work, often as a form of protest against working conditions or labor disputes.

Personal Salvation

The belief or doctrine in various religions that individuals can be saved or redeemed from sin and its consequences, often through faith or religious practices.

Group Salvation

A religious or spiritual concept that emphasizes salvation or redemption as a collective experience rather than solely an individual achievement.