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The Costmore Company uses standard costing and has established the following standards for direct materials and direct labor for each unit it makes Direct Materials 5 gallons at $9.00 per gallon Direct Labor 1.5 hour at $19.50 per hour During July, the company made 7,000 units of product and used 19,500 gallons. The actual price paid for materials was $8.60 per gallon Direct Labor used was 7,200 hours and workers were paid $20.75 per hour. An analysis would indicate Multiple Choice $139.500 favourable materials quantity variance

The Costmore Company uses standard costing and has established the following standards for direct materials and direct labor for each unit it makes Direct Materials 5 gallons at $9.00 per gallon Direct Labor 1.5 hour at $19.50 per hour During July, the company made 7,000 units of product and used 19,500 gallons. The actual price paid for materials was $8.60 per gallon Direct Labor used was 7,200 hours and workers were paid $20.75 per hour. An analysis would indicate Multiple Choice $139.500 favourable materials quantity variance

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter9: Standard Costing: A Functional-based Control Approach
Section: Chapter Questions
Problem 28P: Haversham Corporation produces dress shirts. The company uses a standard costing system and has set...
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The Costmore Company uses standard costing and has established the following standards for direct materials and direct labor for each unit it makes: Direct Materials 5 gallons at $9.00 per gallon Direct Labor 1.5 hour at $19.50 per hour During July, the company made 7,000 units of product and used 19,500 gallons. The actual price paid for materials was $8.60 per gallon. Direct Labor used was 7,200 hours and workers were paid $20.75 per hour. An analysis would indicate Multiple Choice $139,500 favourable materials quantity variance $7,800 unfavourable materials quantity variance $147,300 unfavourable materials quantity variance $147.300 favourable materials quantity variance
Transcribed Image Text:The Costmore Company uses standard costing and has established the following standards for direct materials and direct labor for each unit it makes: Direct Materials 5 gallons at $9.00 per gallon Direct Labor 1.5 hour at $19.50 per hour During July, the company made 7,000 units of product and used 19,500 gallons. The actual price paid for materials was $8.60 per gallon. Direct Labor used was 7,200 hours and workers were paid $20.75 per hour. An analysis would indicate Multiple Choice $139,500 favourable materials quantity variance $7,800 unfavourable materials quantity variance $147,300 unfavourable materials quantity variance $147.300 favourable materials quantity variance
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