The following information relates to a given department of Mervi Company for the first quarter of the year: Actual total overhead (fixed plus variable) P178,500 Budget formula: Total FOH Cost P110,000 + PO.50/hr %3D Total overhead application rate P1.50 per hour Spending variance (from three-way analysis) P8,000 unfavorable Volume variance (from two-way analysis) P5,000 favorable What were the standard hours allowed for good output in this department?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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The following information relates to a given department of Mervi Company for the
first quarter of the year:
Actual total overhead (fixed plus variable)
P178,500
Budget formula: Total FOH Cost = P110,000 + PO.50/hr
%3D
Total overhead application rate
P1.50 per hour
Spending variance (from three-way analysis)
P8,000 unfavorable
Volume variance (from two-way analysis)
P5,000 favorable
What were the standard hours allowed for good output in this department?
105,000
106,667
110,000
115,000
Transcribed Image Text:The following information relates to a given department of Mervi Company for the first quarter of the year: Actual total overhead (fixed plus variable) P178,500 Budget formula: Total FOH Cost = P110,000 + PO.50/hr %3D Total overhead application rate P1.50 per hour Spending variance (from three-way analysis) P8,000 unfavorable Volume variance (from two-way analysis) P5,000 favorable What were the standard hours allowed for good output in this department? 105,000 106,667 110,000 115,000
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