Milar Corporation makes a product with the following standard costs:

Input Standard Quantity or Hours Standard Price or Rate
Direct materials 7.7 pounds $ 4.00 per pound
Direct labor 0.1 hours $ 20.00 per hour
Variable overhead 0.1 hours $ 4.00 per hour

In January the company produced 4,700 units using 10,280 pounds of the direct material and 2,260 direct labor-hours. During the month, the company purchased 10,850 pounds of the direct material at a cost of $76,730. The actual direct labor cost was $38,238 and the actual variable overhead cost was $11,939.

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for January is:

Peninsula products has just applied for a loan at your bank. when reviewing peninsula's books for the year that just ended, you notice that the firm uses the fair value option for its bonds payable. you also see that the firm recorded a $55,000 debit in its bonds payable account and a $55,000 credit in its unrealized holding gain or loss"income account. over that same period, interest rates decreased by about 0.5 percent. how should this information affect the bank's decision as to whether to grant peninsula a loan? a : the bank should strongly consider giving a loan to peninsula because the changes in firm's bonds payable and unrealized holding gain or loss"income accounts suggest that peninsula has seen an increase in its credit rating over the past year. b : the bank should put little emphasis on the changes in peninsula's bonds payable and unrealized holding gain or loss"income accounts because these changes are likely the result of the rise in interest rates. c : the bank should hesitate before giving a loan to peninsula because the changes in firm's bonds payable and unrealized holding gain or loss"income accounts suggest that peninsula has seen a decline in its credit rating over the past year. d : the bank should put little emphasis on the changes in peninsula's bonds payable and unrealized holding gain or loss"income accounts because these changes are likely unrelated to either interest rates or the firm's credit rating.