Galla Corporation Makes a Product with the Following Standard Costs

question 148

Multiple Choice

Galla Corporation makes a product with the following standard costs:


The company budgeted for production of 2,400 units in June, but actual production was 2,500 units. The company used 19,850 pounds of direct material and 980 direct labor-hours to produce this output. The company purchased 21,700 pounds of the direct material at $6.70 per pound. The actual direct labor rate was $19.20 per hour and the actual variable overhead rate was $1.80 per hour.

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.


-The materials quantity variance for June is:

• A)$4,550 U
• B)$4,355 F
• C)$4,550 F
• D)$4,355 U

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Definitions:

Volcanic Glass

A type of rock that forms from the rapid cooling of magma without crystallization, resulting in a smooth, glassy texture.

Volcanic Dome

A rounded mound formed by the slow extrusion of viscous lava from a volcano.

Composite Volcanoes

Composite volcanoes, also known as stratovolcanoes, are tall, conical volcanoes built up by many layers (strata) of hardened lava, tephra, pumice, and volcanic ash.

Rubble-covered

Describes a surface or area that is scattered with broken stones, bricks, and other fragments, often resulting from destruction or decay.