6. If Northern Vale was able to produce all of its annual capacity incurring a direct labor hours of 2% lesser than the total standard direct labor hours allowed but an actual rate of 5% higher than the standard rate, the unfavorable labor spending variance is a. P 142,800 b. P 137,200 c. P 8,925 d. P 8,575 7. Assuming that Mooniyan Division plans to produce 38,000 units of Sacred Hammers for the following year. How much should be the total budgeted factory overhead for the following year? a. 1,120,000 b. 1,040,000 c. 1,012,000 d. 988,000
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
6. If Northern Vale was able to produce all of its annual capacity incurring a direct labor hours of 2% lesser
than the total standard direct labor hours allowed but an actual rate of 5% higher than the standard rate, the
unfavorable labor spending variance is
a. P 142,800
b. P 137,200
c. P 8,925
d. P 8,575
7. Assuming that Mooniyan Division plans to produce 38,000 units of Sacred Hammers for the following year.
How much should be the total budgeted factory
a. 1,120,000
b. 1,040,000
c. 1,012,000
d. 988,000
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