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A corporation reported the following standard-to-actual cost information.
Actual Costs Total Variance
Direct materials $19,250 $900 Favorable
Direct labor $17,600 $800 Unfavorable
Which one of the following best explains both of the corporations variances?
A. Change in the collective bargaining agreement resulting in higher hourly wage rates.
B. Learning curve resulted in more efficient production.
C. Lower-quality, lower-cost materials resulted in higher than expected rework costs.
D. Unexpected increase in electricity costs.
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