Montana Company Uses a Standard Costing System

question 37

Multiple Choice

Montana Company uses a standard costing system. The following information pertains to direct labor costs for the month of February: Standard direct labor rate per hour $15.00
Actual direct labor rate per hour $13.50
Labor rate variance $18,000 favorable
Actual output 1,000 units
Standard hours allowed for actual production 10,000 hours
What is the total labor budget variance for Montana Company?

• A) $18,000 (F)
• B) $12,000 (U)
• C) $18,000 (U)
• D) $12,000 (F)

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Definitions:

Valid Argument

An argument in which, if the premises are true, the conclusion necessarily follows, maintaining logical consistency.

Fugitive

A person who has escaped from capture or is in hiding, often to avoid arrest or persecution.

Valid Argument

A logical sequence of statements where if the premises are true, the conclusion must also be true.

Prejudged

To make a decision or form an opinion about something or someone in advance, without sufficient evidence or through bias.