24. 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.

E. none of the above.

Answer: C

25. 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.

Answer: C

26. Holland Enterprises recently used 20,000 labor hours to produce 8,300 completed units. According to manufacturing specifications, each unit is anticipated to take 2.5 hours to complete. The company's actual payroll cost amounted to $370,000. If the standard labor cost per hour is $18, Holland's labor rate variance is:

A. $10,000F.

B. $10,000U.

C. $10,375F.

D. $10,375U.

E. none of the above.

Answer: B

Please show work(: