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LOFAT Co. uses the two-way variance analysis for overhead performance. The budgeted factory overhead includes monthly fixed costs of P1,200,000 plus variable costs of P96 per direct labor hour. Total standard direct labor hours allowed for the May, 2021 production was 43,200 hours. Analysis showed that, in May 2021, the controllable variance of P24,000 is unfavorable while the volume variance of P12,000 is favorable. How much was the applied factory overhead in May 2021? a. P5,335,200 b. P5,359,200 c. P5,347,200 d. P5,371,200

LOFAT Co. uses the two-way variance analysis for overhead performance. The budgeted factory overhead includes monthly fixed costs of P1,200,000 plus variable costs of P96 per direct labor hour. Total standard direct labor hours allowed for the May, 2021 production was 43,200 hours. Analysis showed that, in May 2021, the controllable variance of P24,000 is unfavorable while the volume variance of P12,000 is favorable. How much was the applied factory overhead in May 2021? a. P5,335,200 b. P5,359,200 c. P5,347,200 d. P5,371,200

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter23: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 9DQ: At the end of the period, the factory overhead account has a credit balance of 10,000. (a) Is the...
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LOFAT Co. uses the two-way variance analysis for overhead performance. The budgeted factory overhead 
includes monthly fixed costs of P1,200,000 plus variable costs of P96 per direct labor hour. Total standard 
direct labor hours allowed for the May, 2021 production was 43,200 hours. Analysis showed that, in May
2021, the controllable variance of P24,000 is unfavorable while the volume variance of P12,000 is favorable. 
How much was the applied factory overhead in May 2021?
a. P5,335,200
b. P5,359,200
c. P5,347,200
d. P5,371,200

 

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