Widman, Inc

question 9

Multiple Choice

Widman, Inc. makes and sells only one product and uses standard costing. The standard cost sheet for one unit of product includes the following:

• Direct materials: 5 grams at $0.35 per gram
• Direct labor: 1 hour at $8 per hour

Last period the company had the following results:

• 5,000 grams of direct materials purchased at $0.40 per gram
• 4,000 grams of direct materials used in production
• 900 units of product were made
• 850 hours of direct labor were used at $8.50 per hour

-The journal entry to record the use of direct materials in production last period would include:

• A)Work in process $1,400, Debit; materials quantity variance $175, Debit
• B)Work in process $1,575, Debit; materials quantity variance $175, Credit
• C)Work in process $1,400, Debit; materials quantity variance $175, Credit
• D)Work in process $1,575, Debit; materials quantity variance $175, Debit

---

Definitions:

Demand Deposits

Bank accounts that allow the holder to withdraw funds without advance notice, often used for day-to-day expenses.

Federal Reserve Bank

One of the 12 regional banks of the Federal Reserve System, each serving a specific geographic area of the United States, involved in banking and monetary policy.

First Bankers

Early financial intermediaries who accepted deposits, facilitated loans, and created ways to transfer wealth across great distances.

Goldsmiths

Historically, skilled artisans who made objects out of gold, but in economic context, also referred to as early bankers who issued loans and held deposits.