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

question 138

Multiple Choice

Degregorio Corporation makes a product that uses a material with the following direct material standards: The company produced 5,600 units in November using 21,750 kilos of the material.During the month,the company purchased 24,800 kilos of the direct material at a total cost of $168,640.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for November is:

• A)$4,256 F
• B)$4,256 U
• C)$4,960 F
• D)$4,960 U

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Definitions:

Net Profit Margin

It is a financial metric that indicates how efficient a company is at generating profit compared to its revenue, expressed as a percentage.

Gross Profit Margin

The difference between sales and the cost of goods sold, expressed as a percentage of sales, indicating the efficiency of a company in managing its production and labor costs.

Asset Turnover Ratio

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue.

Assets

Economic resources owned or controlled by an individual or entity that are expected to provide future benefits.