Tout Corporation Makes a Product That Has the Following Direct

question 47

Multiple Choice

Tout Corporation makes a product that has the following direct labor standards: The company budgeted for production of 6, 400 units in October, but actual production was 6, 500 units.The company used 610 direct labor-hours to produce this output.The actual direct labor rate was $21.80 per hour. The labor efficiency variance for October is:

• A)$872 F
• B)$872 U
• C)$880 U
• D)$880 F

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Definitions:

Skimming Pricing

A pricing strategy that involves setting high prices initially and then gradually lowering them over time.

Penetration Pricing

A pricing strategy where a product is introduced to the market at a very low price to attract customers rapidly.

Breakeven Analysis

The calculation to determine the sales volume at which a business neither makes a profit nor incurs a loss.

Minimum Sales Volume

The lowest quantity of sales that a company needs to achieve within a specific period to cover its direct and indirect costs.