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

question 177

Multiple Choice

Melrose Corporation makes a product that uses a material with the following standards: The company budgeted for production of 5, 800 units in September, but actual production was 5, 900 units.The company used 50, 210 pounds of direct material to produce this output.The company purchased 55, 100 pounds of the direct material at $5.80 per pound. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for September is:

• A)$3, 770 F
• B)$3, 900 U
• C)$3, 770 U
• D)$3, 900 F

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Definitions:

Bonds Payable

Long-term liabilities representing money a company owes to bondholders.

Interest Expense

The cost incurred by an entity for borrowed funds, representing the interest payable on any borrowings - bonds, loans, convertible debt, or lines of credit.