Bennette Corporation has provided the following data concerning its overhead costs for the coming year: Wages and salaries Depreciation $ 530,000 215,000 235,000 $ 980,000 Rent Total The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year: Activity Cost Pool Total Activity labor- Assembly Order processing Other applicable The Other activity cost pool does not have a measure of activity, it is used to accumulate costs of idle capacity and organization-sustaining ca The distribution of resource consumption across activity cost pools is given below: Wages and salaries Depreciation 35,000 hours 450 orders Not Rent Activity Cost Pools Assembly Order Processing 35% 30% 10% 40% 30% 25% The activity rate for the Order Processing activity cost pool is closest to: Other 35% 50% 45% Total 100% 100% 100%
Bennette Corporation has provided the following data concerning its overhead costs for the coming year: Wages and salaries Depreciation $ 530,000 215,000 235,000 $ 980,000 Rent Total The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year: Activity Cost Pool Total Activity labor- Assembly Order processing Other applicable The Other activity cost pool does not have a measure of activity, it is used to accumulate costs of idle capacity and organization-sustaining ca The distribution of resource consumption across activity cost pools is given below: Wages and salaries Depreciation 35,000 hours 450 orders Not Rent Activity Cost Pools Assembly Order Processing 35% 30% 10% 40% 30% 25% The activity rate for the Order Processing activity cost pool is closest to: Other 35% 50% 45% Total 100% 100% 100%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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.
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