13.

CK Shop has prepared the following flexible budget for October and would like to interpret the variances.

Flexible ------------Variances-------------

Budget Price Efficiency

Material A $20,000 $1,000U $3,000U

Material B 40,000 500U 1,000F

Direct manufacturing labor 40,000 500U 2,500F

The MOST likely explanation of the above variances for Material A is that

Select one:

a. a lower price than expected was paid for Material A.

b. Material A used during September was $2,000 less than expected.

c. the company used a higher-priced supplier.

d. high-quality raw materials were used than were planned.