Terrell Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Variable manufacturing overhead Standard Price or Rate $2.30 per hour The company has reported the following actual results for the product for July: Actual output 8,000 units Actual direct labor-hours 2,380 hours 2.10 per hour 4,998 Standard Quantity or Hours per Unit of Output 0.30 hours O $46 U O $42 F O$46 F $42 U Actual variable overhead rate Actual variable overhead cost The variable overhead efficiency variance for the month is closest to: $ $

Terrell Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Variable manufacturing overhead Standard Price or Rate $2.30 per hour The company has reported the following actual results for the product for July: Actual output 8,000 units Actual direct labor-hours 2,380 hours 2.10 per hour 4,998 Standard Quantity or Hours per Unit of Output 0.30 hours O $46 U O $42 F O$46 F $42 U Actual variable overhead rate Actual variable overhead cost The variable overhead efficiency variance for the month is closest to: $ $

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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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Terrell Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing
overhead is applied to products on the basis of direct labor-hours.
Inputs
Variable manufacturing
overhead
O $46 U
$2.30 per hour
The company has reported the following actual results for the product for July:
Actual output
Actual direct labor-hours
Actual variable overhead rate
S
2.10 per hour
Actual variable overhead cost
$
4,998
The variable overhead efficiency variance for the month is closest to:
$42 F
Standard Quantity or Hours
per Unit of Output
O $46 F
O $42 U
Standard Price or Rate
0.30 hours
8,000 units
2,380 hours

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