The Following Materials Standards Have Been Established for a Particular

question 104

Multiple Choice

The following materials standards have been established for a particular product:

The following data pertain to operations concerning the product for the last month: What is the materials quantity variance for the month?

• A) $15,240 U
• B)$6,350 U
• C) $14,340 U
• D) $5,975 U

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Definitions:

Activity Rate

The predetermined overhead rate used in activity-based costing to allocate costs to products or services based on specific activities.

Activity-based Costing

A costing method that assigns costs to products or services based on the activities they require.

First-stage Allocation

The initial process of assigning overhead costs to different departments or cost centers in a business based on relevant criteria.

Plantwide Overhead Rate

A single overhead absorption rate used throughout a factory or plant for allocating overhead costs to products.