Batson Company produces Trivets. Based on its master budget, the company should produce 2,000 Trivets each month, working 3,900 direct labor-hours. During May, only 1,900 Trivets were produced. The company worked 3,800 direct labor-hours. The standard hours allowed for May production would be: Multiple Choice
Batson Company produces Trivets. Based on its master budget, the company should produce 2,000 Trivets each month, working 3,900 direct labor-hours. During May, only 1,900 Trivets were produced. The company worked 3,800 direct labor-hours. The standard hours allowed for May production would be: Multiple Choice
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Batson Company produces Trivets. Based on its master budget , the company should produce 2.000 Trivets each month. working 3.900 direct labor-hours. During May, only 1,900 Trivets were produced.
The company worked 3.800 direct labor-hours. The standard hours allowed for May production would be
Multiple Choice
3,705 hours.
5,610 hours.
3,800 hours.
3.900 hours.
Transcribed Image Text:**Text:**
Batson Company produces trivets. Based on its master budget, the company should produce 2,000 trivets each month, working 3,900 direct labor-hours. During May, only 1,900 trivets were produced. The company worked 3,800 direct labor-hours. The standard hours allowed for May production would be:
**Multiple Choice:**
- 3,705 hours.
- 3,610 hours.
- 3,800 hours.
- 3,900 hours.
**Explanation:**
This multiple-choice question calculates the standard hours allowed for May production. Given the reduced production of 1,900 trivets, the question prompts users to determine the correct number of labor hours that should have been used, according to the standard set by the budget.
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