Maxwell Co

question 168

Essay

Maxwell Co. collected the following information about its production activities for the current year.
a. Compute the direct materials price and quantity variances and indicate whether each is favorable or unfavorable.
b. Prepare the journal entry to record the issuance of direct materials into production.
Actual costs and quantities:
Direct materials used 95,000 lbs. @ $6.30 per lb.
Units completed during the year, 50,000 units
Standard costs and quantities:
Price per lb. of direct material, $6.05
Two lbs. of direct material per unit

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Definitions:

Social Loafing

The phenomenon where individuals exert less effort to achieve a goal when they work in a group compared to when they work alone.

Social Influence

The effect that the words, actions, or mere presence of other people have on our attitudes, beliefs, or actions.

Conformity

The adjustment of one's behaviors, attitudes, or beliefs to match those of the group or to meet group standards.

Propinquity

The physical or psychological proximity between people, influencing their likelihood of forming relationships.