5. During August, 10,000 units were produced. The standard quantity of material allowed per unit was 10 pounds at a standard cost of $3 per pound, If there was an unfavorable usage variance of $18,750 for August, the actual quantity of materials used must be O 23,438 pounds. O 93,750 pounds. O31,875 pounds. 106,250 pounds. 6. ColorPro uses part 87A in the production of color printers. Unit manufacturing costs for part 87A are: Direct materials $8 Direct labor 2 Variable overhead 1 Fixed overhead 4 ColorPro uses 100,000 units of 87A per year. Filbert Company has offered to sell ColorPro 100,000 units of 87A per year for $12. Fixed overhead is unavoidable. Should ColorPro make or buy the part? * Make the part because it will save $100,000 over buying it. Make the part because it will save $1,100,000 over buying it. Buy the part because it will save $300,000 over making it. Buy the part because it will save $100,000 over making it. Buy the part because it will save 1,100,000 over making it.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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5. During August, 10,000 units were produced. The standard quantity of material allowed per unit
was 10 pounds at a standard cost of $3 per pound, If there was an unfavorable usage variance
of $18,750 for August, the actual quantity of materials used must be
O 23,438 pounds.
O 93,750 pounds.
O31,875 pounds.
106,250 pounds.
6. ColorPro uses part 87A in the production of color printers. Unit manufacturing costs for part 87A
are:
Direct materials $8
Direct labor
2
Variable overhead
1
Fixed overhead 4
ColorPro uses 100,000 units of 87A per year. Filbert Company has offered to sell ColorPro
100,000 units of 87A per year for $12. Fixed overhead is unavoidable.
Should ColorPro make or buy the part? *
Make the part because it will save $100,000 over buying it.
Make the part because it will save $1,100,000 over buying it.
Buy the part because it will save $300,000 over making it.
Buy the part because it will save $100,000 over making it.
Buy the part because it will save 1,100,000 over making it.
Transcribed Image Text:5. During August, 10,000 units were produced. The standard quantity of material allowed per unit was 10 pounds at a standard cost of $3 per pound, If there was an unfavorable usage variance of $18,750 for August, the actual quantity of materials used must be O 23,438 pounds. O 93,750 pounds. O31,875 pounds. 106,250 pounds. 6. ColorPro uses part 87A in the production of color printers. Unit manufacturing costs for part 87A are: Direct materials $8 Direct labor 2 Variable overhead 1 Fixed overhead 4 ColorPro uses 100,000 units of 87A per year. Filbert Company has offered to sell ColorPro 100,000 units of 87A per year for $12. Fixed overhead is unavoidable. Should ColorPro make or buy the part? * Make the part because it will save $100,000 over buying it. Make the part because it will save $1,100,000 over buying it. Buy the part because it will save $300,000 over making it. Buy the part because it will save $100,000 over making it. Buy the part because it will save 1,100,000 over making it.
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