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7 years ago
Delicious Food Products is famous for its frosted fruit cake. The main ingredient of the cake is dried fruit, which Delicious purchases by the pound. In addition, the production requires a certain amount of direct labor. Delicious uses a standard cost system, and at the end of the first quarter, there was a favorable direct materials cost variance. Which of the following is a logical explanation for that variance?
A) The production staff changed the work flow process so that there was less wastage of direct materials during production.
B) The production manager negotiated a lower wage package for production staff, bringing direct labor costs down.
C) The factory lost two experienced workers at the beginning of the quarter, and their replacements worked at a much slower pace during their training period.
D) The purchasing manager was able to secure a volume discount on dried fruit, purchasing the fruit for less than the amount set by standard.
Textbook 
Horngren's Financial & Managerial Accounting, The Financial Chapters

Horngren's Financial & Managerial Accounting, The Financial Chapters


Edition: 5th
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Deprecated Author
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#2
7 years ago
Will mark this subject solved, thanks
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3 years ago
Thank you
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