Pomander Inc

question 68

Multiple Choice

Pomander Inc. had the following information related to last year's sales: What amount would be reported as "cash collections from customers" on the statement of cash flows using the direct method?

• A) $254,000
• B) $381,500
• C) $111,500
• D) $353,500

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Definitions:

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours expected for the actual production level, multiplied by the standard labor rate.

Direct Materials

The raw materials that are directly traceable to a finished product and are an integral part of the finished product.

Standard Costs

Predetermined costs for material, labor, and overhead used as benchmarks against which to compare the actual production costs.

Direct Material

Raw materials that are directly traced and assigned to the production of a specific product.