Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Golden Marine Stores Company manufactures special metallic materials and decorative fittings for luxury yachts that require highly skilled labor. Golden uses standard costs to prepare

Golden Marine Stores Company manufactures special metallic materials and decorative fittings for luxury yachts that require highly skilled labor. Golden 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: 2 pounds per unit, $3 per pound
Labor: 5 hours per unit, $24 per hour
During the first quarter, Golden produced 5,000 units of this product. At the end of the quarter, an examination of the direct materials records showed that the company used 9,500 pounds of direct materials and the direct materials cost variance was $3,810U. Which of the following is a logical explanation for this variance?
A. The company used more labor hours than allowed by the standards.
B. The company paid a higher cost for the direct materials than allowed by the standards.
C. The company used a greater quantity of direct materials than allowed by the standards.
D. The company paid a higher cost per hour for labor than allowed by the standards.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik

10th edition

0-07-794127-6, 978-0-07-79412, 978-0077431808

Students also viewed these Accounting questions

Question

Moving to another question will save this response

Answered: 1 week ago