ABC Manufacturing uses standard costing for its product costing. Manufacturing overhead is applied based onstandard direct labour hours (DLH). Overhead cost information is presented below:InputCost per UnitVariable$7.20 per DLH36Fixed$9.60 per DLH48Total$ 84During the most recent month a total of 7,800 units were produced; 40,100 DLH were used and total actualmanufacturing overhead was $720,000 of which $391,000 was fixed. What was the variable overhead efficiencyvariance?

5. Variable overhead efficiency variance Variable overhead efficiency variance = (Standard Hours for…

Answered: ABC Manufacturing uses standard costing…

Business

Accounting

ABC Manufacturing uses standard costing for its prod

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

ABC Manufacturing uses standard costing for its product costing. Manufacturing overhead is applied based on
standard direct labour hours (DLH). Overhead cost information is presented below:
Input
Cost per Unit
Variable
$7.20 per DLH
36
Fixed
$9.60 per DLH
48
Total
$ 84
During the most recent month a total of 7,800 units were produced; 40,100 DLH were used and total actual
manufacturing overhead was $720,000 of which $391,000 was fixed. What was the variable overhead efficiency
variance?

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