Glascro Company's standard cost is $500,000.The allowable deviation is ±15%.Its actual costs for six months are as follows:
The actual cost which is higher than the upper control limit is _____.
A) $450,000
B) $575,000
C) $330,000
D) $467,000

Question

Glascro Company's standard cost is $500,000.The allowable deviation is ±15%.Its actual costs for six months are as follows: 
 The actual cost which is higher than the upper control limit is _____.
A) $450,000 
B) $575,000 
C) $330,000 
D) $467,000

Quizplus · Accepted Answer

The upper control limit is = Standard cost + (Standard cost × Allowable deviation)
= $500,000 + ($500,000 × 15%) = $575,000

Glascro Company's Standard Cost Is $500,000