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19) AAA uses standard costs to prepare its flexible budget. For the first quarter of the year, direct materials and direct labor standards for one
19) AAA uses standard costs to prepare its flexible budget. For the first quarter of the year, direct materials and direct labor standards for one of their popular products were as follows: Direct materials: 3 pounds per unit: $3 per pound Direct labor: S hours per unit: $15 per hour AAA produced 5000 units during the quarter. At the end of the quarter, an examination of the labor costs records showed that the direct labor price variance was $8000 F. Which of the following is a logical explanation for this variance? A) The company used a lower quantity of direct materials than allowed by the standards. B) The company paid a lower cost per hour for labor than allowed by the standards. C) The company paid a lower cost for the direct materials than allowed by the standards. D) The company used fewer labor hours than allowed by the standards
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