Gigil Company has asked you to reconstruct their record after a fire. You were given the following variances: Favorable Spending variance, P400,000; Unfavorable Variable efficiency variance, P200,000; Favorable Volume variance, P40,000. Total fixed overhead is P200,000 at normal capacity. The company's standard variable overhead is P40 per direct labor hour. In the given period, the company incurred a total overhead cost of P2,400,000. Compute for the standard factory overhead rate.

Gigil Company has asked you to reconstruct their record after a fire. You were given the following variances: Favorable Spending variance, P400,000; Unfavorable Variable efficiency variance, P200,000; Favorable Volume variance, P40,000. Total fixed overhead is P200,000 at normal capacity. The company's standard variable overhead is P40 per direct labor hour. In the given period, the company incurred a total overhead cost of P2,400,000. Compute for the standard factory overhead rate.

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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