A Company Has Established 5 Pounds of Material J at $2

question 190

Multiple Choice

A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z.The company has just produced 1,000 units of this product,using 5,200 pounds of Material J that cost $9,880.The direct materials quantity variance is:

• A)$400 unfavorable.
• B)$120 favorable.
• C)$400 favorable.
• D)$520 favorable.
• E)$520 unfavorable.

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Definitions:

Financial Components

The various elements that make up the financial structure of a company, including assets, liabilities, revenues, and expenses.

Collection Pattern

The typical manner or time frame in which a business receives payments from its customers for goods or services sold.

Budgeted Sales

Budgeted Sales represent the anticipated sales revenue of a business, based on forecasted selling quantities and prices for a specific period.

Cash Collections

The process of gathering all payments or monetary amounts received from customers over a period.