budgeting again 15-16
Raff Co. has a standard cost system in which factory overhead is applied to units of product on the basis of direct labor hours (DLH). The following standards are based on 100,000 direct labor hours:
Variable overhead 2DLHs @ $3 per DLH = $6 per unit
Fixed overhead 2 DLHs @ $4 per DLH = $8 per unit
The following information for March is available
Units actually produced 38,000
Actual direct labor hours worked 80,000
Actual manufacturing overhead incurred:
Variable overhead $250,000
Fixed overhead $384,000
15. What is the variable factory overhead controllable variance?
A. $6,000 favorable
B. $10,000 unfavorable
C. $12,000 unfavorable
D. $22,000 favorable
16. What is the fixed factory overhead volume variance?
A. $96,000 unfavorable
B. $96,000 favorable
C. $80,000 unfavorable
D. $80,000 favorable
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