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Zinkyl Corporation produces high-quality leather boots. The company has a standard cost system and has set the following standards for materials and labor: Leather (10 strips @ $20) $200 Direct labor (10 hours @ $10) $100 Total prime cost $300 During the year, Zinkyl produced 100 boots. Actual leather purchased was 1,500 strips, at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 1,000 hours at $10 per hour. Compute the materials price variance. a.$12,000 F b.$6,000 F c.$7,300 U d.$16,800 U

Zinkyl Corporation produces high-quality leather boots. The company has a standard cost system and has set the following standards for materials and labor: Leather (10 strips @ $20) $200 Direct labor (10 hours @ $10) $100 Total prime cost $300 During the year, Zinkyl produced 100 boots. Actual leather purchased was 1,500 strips, at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 1,000 hours at $10 per hour. Compute the materials price variance. a.$12,000 F b.$6,000 F c.$7,300 U d.$16,800 U

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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  1. Zinkyl Corporation produces high-quality leather boots. The company has a standard cost system and has set the following standards for materials and labor:

    Leather (10 strips @ $20) $200
    Direct labor (10 hours @ $10) $100
    Total prime cost $300

    During the year, Zinkyl produced 100 boots. Actual leather purchased was 1,500 strips, at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 1,000 hours at $10 per hour.

    Compute the materials price variance.
    a.$12,000 F
    b.$6,000 F
    c.$7,300 U
    d.$16,800 U
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