Lucky Number 13, Inc. ran into some unfortunate luck, having their IT environment hacked by a foreign government. As a result of the hack, valuable information regarding direct material purchases and usage were stolen. A manager was able to pull previous records and determined that 3,000 fewer pounds were used in the production of 50,000 pairs of sweatpants last period than were purchased. Data also shows that the total direct material variance was 510,000 unfavorable. The direct material price variance was documented to be $150,000 favorable, which resulted from the actual cost per pound of direct material being $4.00 lower than the expected cost of $10.00 per pound. Additional documentation regarding the direct materials quantity variance could not be found. The number of pounds needed to produce each pair of sweatpants is OA. 0.986000 Pounds OB. 0.946000 Pounds OC. 0.974000 Pounds OD. 0.394000 Pounds

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Topic Video
Question
Lucky Number 13, Inc. ran into some unfortunate luck, having their IT environment hacked by a foreign government.
As a result of the hack, valuable information regarding direct material purchases and usage were stolen. A manager
was able to pull previous records and determined that 3,000 fewer pounds were used in the production of 50,000
pairs of sweatpants last period than were purchased. Data also shows that the total direct material variance was
$10,000 unfavorable. The direct material price variance was documented to be $150,000 favorable, which resulted
from the actual cost per pound of direct material being $4.00 lower than the expected cost of $10.00 per pound.
Additional documentation regarding the direct materials quantity variance could not be found. The number of pounds
needed to produce each pair of sweatpants is
OA. 0.986000 Pounds
OB. 0.946000 Pounds
OC. 0.974000 Pounds
OD. 0.394000 Pounds
Transcribed Image Text:Lucky Number 13, Inc. ran into some unfortunate luck, having their IT environment hacked by a foreign government. As a result of the hack, valuable information regarding direct material purchases and usage were stolen. A manager was able to pull previous records and determined that 3,000 fewer pounds were used in the production of 50,000 pairs of sweatpants last period than were purchased. Data also shows that the total direct material variance was $10,000 unfavorable. The direct material price variance was documented to be $150,000 favorable, which resulted from the actual cost per pound of direct material being $4.00 lower than the expected cost of $10.00 per pound. Additional documentation regarding the direct materials quantity variance could not be found. The number of pounds needed to produce each pair of sweatpants is OA. 0.986000 Pounds OB. 0.946000 Pounds OC. 0.974000 Pounds OD. 0.394000 Pounds
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Performance measurements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education