25. Novelli Corporation makes a product whose variable overhead standards are ba

Question

25. Novelli Corporation makes a product whose variable overhead standards are based on direct labor-hours. The quantity standard is 0.6 hours per unit. The variable overhead rate standard is $7.00 per hour. In September, the company produced 1,850 units using 1,100 direct labor-hours. The actual variable overhead rate was $7.50 per hour.

The variable overhead efficiency variance for September is:

A. $75 U

B. $70 U

C. $75 F

D. $70 F

26. The variable overhead rate variance for September is:

Noreen 4e Rechecks 2017-24-03

A. $550 F

B. $579 U

C. $550 U

D. $579 F

Explanation / Answer

The variable overhead efficiency variance for September is

Variable overhead efficiency variance = (Standard hours-actual hours)Standard rate

= (1850*.6-1100)7

Variable overhead efficiency variance = 70 F

so answer is d) $70 F

Variable overhead rate variance = (Standard rate-actual rate)Actual hours

= (7-7.50)1100

Variable overhead rate variance = 550 U

so answer isc ) $550 U

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.