Allan Company manufactures overalls. During the year, it manufactured 125,000 overalls, using 2.9 hours of direct labour at a rate of $6.25 per hour. The materials and labour standards for manufacturing the overalls are as follows:
Allan required 600,000 m at $1.95 per metre to make the 125,000 overalls.
$\begin{array}{lll}
\text {Direct materials ( $ 5 \mathrm{~m} $ of denim $ (012 $ per metre) }&\$10\
\text { Direct labour (3 hours $ @ \$ 6 $ per hour)}&18\\end{array}$

-Refer to the Figure.What is Allan's materials usage variance?
A)$48,750 U
B)$48,750 F
C)$50,000 U
D)$50,000 F

Question

Allan Company manufactures overalls. During the year, it manufactured 125,000 overalls, using 2.9 hours of direct labour at a rate of $6.25 per hour. The materials and labour standards for manufacturing the overalls are as follows:
Allan required 600,000 m at $1.95 per metre to make the 125,000 overalls.
 $\begin{array}{lll}
\text {Direct materials ( $ 5 \mathrm{~m} $ of denim $ (012 $ per metre) }&\$10\
\text { Direct labour (3 hours $ @ \$ 6 $ per hour)}&18\\end{array}$

-Refer to the Figure.What is Allan's materials usage variance?
A)$48,750 U
B)$48,750 F
C)$50,000 U
D)$50,000 F

Quizplus · Accepted Answer

The Answer of Allan Company manufactures overalls. During the year, it manufactured 125,000 overalls, using 2.9 hours of direct labour at a rate of $6.25 per hour. The materials and labour standards for manufacturing the overalls are as follows:
Allan required 600,000 m at $1.95 per metre to make the 125,000 overalls.
 $\begin{array}{lll}
\text {Direct materials ( $ 5 \mathrm{~m} $ of denim $ (012 $ per metre) }&\$10\
\text { Direct labour (3 hours $ @ \$ 6 $ per hour)}&18\\end{array}$

-Refer to the Figure.What is Allan's materials usage variance?
A)$48,750 U
B)$48,750 F
C)$50,000 U
D)$50,000 F

Allan Company Manufactures Overalls -Refer to the Figure