A company's annual overhead costs are estimated to be $400,000 and direct labor costs to be $1,000,000. Actual overhead was $305,000, and actual labor costs totaled $1,100,000. How much is the company's predetermined overhead rate to the nearest cent? a. $.31 b. $.40 c. $.28 d. .33
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.
A company's annual
a. $.31
b. $.40
c. $.28
d. .33
Should we accept a special order for 1,000 at a selling price of $40 if our variable costs are $15 per unit and there would be an additional fixed costs of $12,000?
a. Yes, net income would go up by $25,000
b. No, net income would go down by $25,000
c. No, net income would go down by $13,000
d. Yes, net income would go up by $13,000
Division 1 has the following information: Sales is $200,000; Variable costs are $130,000; Fixed costs are $100,000; leaving a loss of $30,000. If we drop division 1, 60% of the fixed costs could be saved. Should we drop division 1?
a. Yes, overall company net income would go up by $30,000
b. No, overall company net income would go down by $30,000
c. Yes, overall company net income would go up by $10,000
d. No, overall company net income would go down by $10,000
Please determine the total amount of Direct Labor in our Budget for January and February together given the following information: Direct labor per unit = .25 hours; Direct labor rate is $30 per hour; Expected number of units to produce in January is 20,000 units and in February is 15,000 units.
a. $200,000
b. $235,000
c. $262,500
d. $285,000
We prepared a budget based on manufacturing 20,000 chairs this month. Budgeted costs are: Fixed
a. $260,000
b. $50,000
c. $250,000
d. $200,000
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