Jackson Industries Uses a Standard Cost System in Which Direct

question 30

Multiple Choice

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Jackson has established the following standards for one unit of product.

During May, Jackson purchased 125,000 pounds of direct material at a total cost of $475,000. The total factory wages for May were $364,000, 90 percent of which were for direct labor. Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct material and 28,000 direct labor-hours.

-The price variance for the direct material acquired by Jackson Industries during May is:

• A)$21,600 Favorable
• B)$25,000 Unfavorable
• C)$28,000 Favorable
• D)$21,600 Unfavorable

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Definitions:

Internal Supply

Refers to the resources, capabilities, and competencies that are available within an organization, which can be utilized to achieve strategic objectives.

Retrained

The process of teaching employees new skills or refreshing their existing skills to meet the current demands of their job or prepare for new job roles.

HR Supply

The availability of qualified candidates, both internally and externally, to meet the human resources needs of an organization.

Employee Turnover

The rate at which employees leave a company and are replaced by new hires, often used as an indicator of the work environment and employee satisfaction.