Assume (1) the quantity of materials purchased equals the quantity used in production, (2) the materials price variance is $400 unfavorable, and (3) the materials quantity variance is $200 favorable. Given these assumptions, which of the following statements is true? Multiple Choice The materials spending variance must be $200 favorable. The materials spending variance must be $600 favorable. The materials spending variance must be $200 unfavorable. The materials spending variance must be $600 unfavorable.

Assume (1) the quantity of materials purchased equals the quantity used in production, (2) the materials price variance is $400 unfavorable, and (3) the materials quantity variance is $200 favorable. Given these assumptions, which of the following statements is true? Multiple Choice The materials spending variance must be $200 favorable. The materials spending variance must be $600 favorable. The materials spending variance must be $200 unfavorable. The materials spending variance must be $600 unfavorable.

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Description: Assume (1) the quantity of materials purchased equals the quantity used in production, (2) the materials price variance is $400 unfavorable, and (3) the materials quantity variance is $200 favorable. Given theseassumptions, which of the following st

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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1-What makes a variance favorable? Give an example of a favorable variance involving materials. What makes a variance unfavorable? Give an example of an unfavorable variance involving labor. 2-How do you balance a firm’s need to succeed and the need for not asking the workers for perfection? 3-What two components are needed to determine a standard for materials? 4-What makes a variance favorable? Give an example of a favorable variance involving materials. What makes a variance unfavorable? Give an example of an unfavorable variance involving labor.
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