Question
Giftmonger Party Supplies uses value stream income statements. These statements include three value streams and two non-value streams. The first value stream is the Birthday
Giftmonger Party Supplies uses value stream income statements. These statements include three value streams and two non-value streams. The first value stream is the Birthday Party value stream. In this value stream, the value stream income statement shows the following cost numbers: $100,000 materials cost, $150,000 labor cost, and $75,000 variable overhead cost. (The firm has no fixed overhead.)
Which of the following is MOST LIKELY to be TRUE about these cost numbers?
a. | These cost numbers are the standard dollar amounts for the firm's work in the Birthday Party value stream. | |
b. | These cost numbers are the actual dollar amounts incurred by the firm for work in the Birthday Party value stream. | |
c. | These cost numbers are net of quantity and price variances for direct materials, direct labor, and variable overhead. | |
d. | These cost numbers are the actual dollar amounts incurred by the firm except for variable overhead, which is applied to individual product units using a PDOH rate. |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started