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NEW QUESTION: 1
In an attempt to improve product quality, the management team of Valcq Co replaced some material with more expensive items and introduced a bonus scheme. The bonus scheme was based on reducing both the number of defective units produced and material wastage. No changes were made to the standard costs.
What material variances are likely to be reported as a direct result of these decisions?
A. Materialprice:Adverse, Materialusage:Favorable
B. Materialprice:Favorable, Materialusage:Favorable
C. Materialprice:Favorable, Materialusage:Adverse
D. Materialprice:Adverse, Materialusage:Adverse
Answer: A

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