Reference no: EM133168163

Question - Machine Builders Incorporated adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows:

Materials: (4.0 kilograms × $10.00 per kilogram) $40.00

Labor: (4.0 hours × $18.00 per hour) $72.00

All materials are issued at the beginning of processing. The operating data shown below were taken from the records for July:

In-process beginning inventory none

In-process ending inventory-90% complete as to labor 1,000 units

Units completed during the month 7,200 units

Budgeted output 8,000 units

Purchases of materials, in kilograms (AQ) 30,000

Total actual labor costs incurred $ 525,000

Direct labor hours worked (AQ) 28,000 hours

Materials purchase-price variance $ 3,000 unfavorable

Increase in materials inventory in July 1,500 kilograms

Beginning inventory of materials 0 kilogram

Required - Determine the direct labor flexible-budget variance for July?

a. $6,600 unfavorable.

b. $51,000 favorable.

c. $58,200 favorable.

d. $65,400 favorable.

e. $7,200 unfavorable.