FastTec, which sells electronics in retail outlets and on the Internet, uses act
ID: 2377715 • Letter: F
Question
FastTec, which sells electronics in retail outlets and on the Internet, uses activity-based budgeting in the preparation of its selling, general, and administrative expense budget. Which of the following costs would the company likely classify as a unit-level expense on its budget?A)MEDIA ADVERTISING
B) RETAIL OUTLET SALES COMISSIONS
C)SALARIES OF WEB-SITE MAINTENCE PERSONNEL
D) ADMINISTRATIVE SALARIES
E) SALARY OF THE SALE MANAGER EPLOYED AT STORE NO 23
Courtney purchased and consumed 50,000 gallons of direct material that was used in the production of 11,000 finished units of product. According to engineering specifications, each finished unit had a manufacturing standard of five gallons. If a review of Courtney's accounting records at the end of the period disclosed a material price variance of $5,000U and a material quantity variance of $3,000F, determine the actual price paid for a gallon of direct material.
A. $0.50.
B. $0.60.
C. $0.70.
D. An amount other than those shown above.
E. Not enough information to judge. Consider the following information:
Direct material purchased and used, 80,000 gallons
Standard quantity of direct material allowed for May production, 76,000 gallons
Actual cost of direct materials purchased and used, $176,000
Unfavorable direct-material quantity variance, $9,400
The direct-material price variance is:
A. $11,400F.
B. $11,400U.
C. $12,000F.
D. $12,000U.
FastTec, which sells electronics in retail outlets and on the Internet, uses activity-based budgeting in the preparation of its selling, general, and administrative expense budget. Which of the following costs would the company likely classify as a unit-level expense on its budget?
A)MEDIA ADVERTISING
B) RETAIL OUTLET SALES COMISSIONS
C)SALARIES OF WEB-SITE MAINTENCE PERSONNEL
D) ADMINISTRATIVE SALARIES
E) SALARY OF THE SALE MANAGER EPLOYED AT STORE NO 23
Courtney purchased and consumed 50,000 gallons of direct material that was used in the production of 11,000 finished units of product. According to engineering specifications, each finished unit had a manufacturing standard of five gallons. If a review of Courtney's accounting records at the end of the period disclosed a material price variance of $5,000U and a material quantity variance of $3,000F, determine the actual price paid for a gallon of direct material.
A. $0.50.
B. $0.60.
C. $0.70.
D. An amount other than those shown above.
E. Not enough information to judge. Consider the following information:
Direct material purchased and used, 80,000 gallons
Standard quantity of direct material allowed for May production, 76,000 gallons
Actual cost of direct materials purchased and used, $176,000
Unfavorable direct-material quantity variance, $9,400
The direct-material price variance is:
A. $11,400F.
B. $11,400U.
C. $12,000F.
D. $12,000U.
Explanation / Answer
B) RETAIL OUTLET SALES COMISSIONS
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