Hudson Company's variable overhead is applied on the basis of direct labor hours. The standard cost card specifies 3 direct labor hours per unit of its product. The standard variable overhead rate is $5 per direct labor hour. Last quarter, Hudson actually produced 10,000 units of product. The company's accounting records show its variable overhead efficiency variance was $5,000 Unfavorable and variable overhead rate variance was $12,000 Favorable. What was Hudson's actual variable overhead cost last quarter? a) $143,000 b) $157,000 c) $167,000 d) $133,000

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 11EA: A manufacturer planned to use $78 of variable overhead per unit produced, but in the most recent...
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Hudson Company's variable overhead is applied on the basis of direct labor
hours. The standard cost card specifies 3 direct labor hours per unit of its product.
The standard variable overhead rate is $5 per direct labor hour. Last quarter,
Hudson actually produced 10,000 units of product. The company's accounting
records show its variable overhead efficiency variance was $5,000 Unfavorable
and variable overhead rate variance was $12,000 Favorable. What was Hudson's
actual variable overhead cost last quarter?
a) $143,000
b) $157,000
c) $167,000
d) $133,000
Transcribed Image Text:Hudson Company's variable overhead is applied on the basis of direct labor hours. The standard cost card specifies 3 direct labor hours per unit of its product. The standard variable overhead rate is $5 per direct labor hour. Last quarter, Hudson actually produced 10,000 units of product. The company's accounting records show its variable overhead efficiency variance was $5,000 Unfavorable and variable overhead rate variance was $12,000 Favorable. What was Hudson's actual variable overhead cost last quarter? a) $143,000 b) $157,000 c) $167,000 d) $133,000
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