Teal Company buys and uses 1,500 pounds of materials in making 300 units for $2 per pound. Teal Company's standards say that they will use 6 pounds of materials for each unit and should pay $2.10 per pound.

What is the Direct Materials Quantity Variance?

• A.

  $150 Favorable

• B.

  $150 Unfavorable

• C.

  $630 Favorable

• D.

  $630 Unfavorable

Units sell for $30 each and have variable expenses of $12 each. If fixed expenses are $5,760, what is the break even point?

• A. 480 units
• B. 192 units
• C. 478 units
• D. 320 units

Job Order Costing:

• A. Is used to assign costs to jobs when companies make more than one product.
• B. Is used to give priority to jobs that take more time to complete.
• C. Is used to allocate costs evenly when a company makes only one product.
• D. Is used to allocate selling and administrative costs throughout an organization.

Which of the following is NOT a product cost?

• A. Direct Materials
• B. Direct Labor
• C. Manufacturing Overhead
• D. Sales Commissions

Contribution Margin is equal to:

• A. Sales - Fixed Costs - Variable Costs
• B. Sales - Variable Costs
• C. Fixed Costs + Variable Costs
• D. Sales - Fixed Costs