The Dexon Company makes and sells a single product, called a Mip, and employs a standard costing system. The following standards have been established for one unit of Mip: Standard Quantity or Hours 6 board metre 0.8 hours Standard Cost per Mip $9.00 $9.60 Direct Materials Direct Labour There were no inventories of any kind on August 1. During August, the following events occurred: Purchased 15,000 board metres at the total cost of $24,000. Used 12,000 board metres to produce 2,100 Mips. Used 1,700 hours of direct labour time at a total cost of $20,060. 6. To record the purchase of direct materials, the general ledger would include what entry to the Materials Price Variance account? A) $1,500 credit. B) $1,500 debit. C) $6,000 credit. D) $6,000 debit.

The Dexon Company makes and sells a single product, called a Mip, and employs a standard costing system. The following standards have been established for one unit of Mip: Standard Quantity or Hours 6 board metre 0.8 hours Standard Cost per Mip $9.00 $9.60 Direct Materials Direct Labour There were no inventories of any kind on August 1. During August, the following events occurred: Purchased 15,000 board metres at the total cost of $24,000. Used 12,000 board metres to produce 2,100 Mips. Used 1,700 hours of direct labour time at a total cost of $20,060. 6. To record the purchase of direct materials, the general ledger would include what entry to the Materials Price Variance account? A) $1,500 credit. B) $1,500 debit. C) $6,000 credit. D) $6,000 debit.

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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