Question

The Maxit Corporation has a standard costing system in which variable manufacturing overhead is assigned to...

The Maxit Corporation has a standard costing system in which variable manufacturing overhead is assigned to production on the basis of standard machine-hours. The following data are available for July:

  • Actual variable manufacturing overhead cost incurred: $25,700
  • Actual machine-hours worked: 3,000 hours
  • Variable overhead rate variance: $5,520 U
  • Total variable overhead spending variance: $7,700 U

The variable overhead efficiency variance for July is:

Multiple Choice

  • $13,220 F

  • $13,220 U

  • $2,180 U

  • $2,180 F

Tharaldson Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit
Direct materials 6.3 ounces $ 2.00 per ounce $ 12.60
Direct labor 0.4 hours $ 11.00 per hour $ 4.40
Variable overhead 0.4 hours $ 6.00 per hour $ 2.40

The company reported the following results concerning this product in June.

Originally budgeted output 3,300 units
Actual output 2,600 units
Raw materials used in production 21,300 ounces
Purchases of raw materials 22,400 ounces
Actual direct labor-hours 470 hours
Actual cost of raw materials purchases $ 42,000
Actual direct labor cost $ 13,300
Actual variable overhead cost $ 3,650

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 labor rate variance for June is:

Garrison 16e Rechecks 2017-10-31

Multiple Choice

  • $2,552 U

  • $8,130 U

  • $8,130 F

  • $2,552 F

0 0
Add a comment Improve this question Transcribed image text
Answer #1

1. Variable overhead efficiency variance

= VOH spending variance - VOH rate variance

= 7700U - 5520U

= 2180 U

.

2. Labor rate variance = (SR-AR) *AH

= (11-13300/470)*470

= 8130 U

Add a comment
Know the answer?
Add Answer to:
The Maxit Corporation has a standard costing system in which variable manufacturing overhead is assigned to...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 5.4 ounces $ 3.00 per ounce $ 16.20 Direct labor 0.5 hours $ 12.00 per hour $ 6.00 Variable overhead 0.5 hours $ 9.00 per hour $ 4.50 The company reported the following results concerning this product in June. Originally budgeted output 4,200 units Actual output 4,200 units Raw materials used in production 20,400 ounces Purchases...

  • Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 5.4 ounces $ 3.00 per ounce $ 16.20 Direct labor 0.7 hours $ 12.00 per hour $ 8.40 Variable overhead 0.7 hours $ 9.00 per hour $ 6.30 The company reported the following results concerning this product in June. Originally budgeted output 4,200 units Actual output 4,200 units Raw materials used in production 20,400 ounces Purchases...

  • Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 7.0 ounces $ 3.00 per ounce $ 21.00 Direct labor 0.3 hours $ 14.00 per hour $ 4.20 Variable overhead 0.3 hours $ 9.00 per hour $ 2.70 The company reported the following results concerning this product in June. Originally budgeted output 2,400 units Actual output 2,900 units Raw materials used in production 22,000 ounces Purchases...

  • Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 5.6 ounces $ 7.00 per ounce $ 39.20 Direct labor 0.7 hours $ 10.00 per hour $ 7.00 Variable overhead 0.7 hours $ 7.00 per hour $ 4.90 The company reported the following results concerning this product in June. Originally budgeted output 4,000 units Actual output 4,000 units Raw materials used in production 23,000 ounces Purchases...

  • Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 7.5 ounces $ 3.00 per ounce $ 22.50 Direct labor 0.9 hours $ 19.00 per hour $ 17.10 Variable overhead 0.9 hours $ 8.00 per hour $ 7.20 The company reported the following results concerning this product in June. Originally budgeted output 2,900 units Actual output 2,500 units Raw materials used in production 20,700 ounces Purchases...

  • Majer Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead...

    Majer Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Standard Standard Quantity or Standard Price or Cost Per Hours Rate Unit 6.4 ounces $ 3.00 per ounce $19.20 0.4 hours $13.00 per hour $ 5.20 0.4 hours $ 5.00 per hour $ 2.00 The company reported the following results concerning this product in February. Originally budgeted output Actual output Raw materials used in production Actual direct labor-hours Purchases of raw materials Actual price...

  • 2. Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of stan...

    2. Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard Price or Standard Standard Quantity 6.70 pounds Rate Cost $ 3.35 Direct materials $ .50 per pound $42.50 per hour $ 9.40 per hour Direct labor 0.40 hours $17.00 $ 3.76 Variable manufacturing overhead 0.40 hours During March, the following...

  • 2. The following data have been provided by Lopus Corporation: Budgeted production Standard machine-hours per unit Sta...

    2. The following data have been provided by Lopus Corporation: Budgeted production Standard machine-hours per unit Standard lubricants Standard supplies 4,000 units 4.1 machine-hours 5.60 per machine-hour 4.30 per machine-hour $ $ Actual production Actual machine-hours Actual lubricants (total) Actual supplies (total) 4,300 units 9,480 machine-hours $ 54,833 $40,239 Required: Compute the variable overhead rate variances for lubricants and for supplies. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect...

  • Oddo Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

    Oddo Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit   Direct materials 2.0 ounces $6.00 per ounce $12.00   Direct labor 0.6 hours $12.00 per hour $7.20   Variable overhead 0.6 hours $4.50 per hour $2.70 The company reported the following results concerning this product in December.   Originally budgeted output 6,400 units   Actual output 6,200 units   Raw materials used in production 9,600 ounces   Actual direct labor-hours 3,920 hours   Purchases of...

  • 2. Fortes Inc. has provided the following data concerning one of the products in its standard...

    2. Fortes Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Direct materials Direct labor Variable manufacturing overhead Standard Quantity or Hours per Unit of Output 7.1 ounces 0.6 hours 0.6 hours Standard Price or Rate $ 7.30 per ounce $26.70 per hour $ 5.60 per hour The company has reported the following actual results for the product for...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT