A Corp uses predetermined Overhead application rate is based on direct labor hours. During the year, it incurred 345,000 of actual OH, but planned to incur 360,000 of overhead. The company incurred actual labor hours of 1,210,000 hours and applied OH of 363,000 during the year. How many direct labor hours did the company plan to incur?
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 Corp uses predetermined
Step by step
Solved in 2 steps
