(Appendix 11A)The Murray Corporation Uses a Standard Cost System in Which

question 73

Multiple Choice

(Appendix 11A) The Murray Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours (DLHs) .The company recorded the following activity and cost data for May: The fixed manufacturing overhead budget variance for May was:

• A)$8, 000 F
• B)$8, 000 U
• C)$1, 600 F
• D)$1, 600 U

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Definitions:

Work-In-Process Inventory

The cost of unfinished goods in the manufacturing process including labor, material, and overhead.

Total Manufacturing Cost

The aggregate cost of direct materials, direct labor, and manufacturing overhead utilized in producing goods within a reporting period.

Direct Labor Costs

Expenses associated with the labor directly involved in the production of goods or provision of services.

Raw Materials Costs

The expenses associated with acquiring raw materials required to manufacture a product.