The following data have been provided by Mathews Corporation: Budgeted production 6,900 units Standard machine-hours per unit 9.4 machine-hours Standard lubricants rate $1.20 per machine-hour Standard supplies rate $1.00 per machine-hour Actual production 7,000 units Actual machine-hours (total) 66,230 machine-hours Actual lubricants cost (total) $78,100 Actual supplies cost (total) $66,536 Lubricants and supplies are both elements of variable manufacturing overhead. The variable overhead rate variance for supplies is closest to:
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
The following data have been provided by Mathews Corporation:
| Budgeted production | 6,900 | units |
| Standard machine-hours per unit | 9.4 | machine-hours |
| Standard lubricants rate | $1.20 | per machine-hour |
| Standard supplies rate | $1.00 | per machine-hour |
| Actual production | 7,000 | units |
| Actual machine-hours (total) | 66,230 | machine-hours |
| Actual lubricants cost (total) | $78,100 | |
| Actual supplies cost (total) | $66,536 |
Lubricants and supplies are both elements of variable manufacturing
The variable overhead rate variance for supplies is closest to:
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