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The standard factory overhead rate is $7.50 per machine hour ($6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of the normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: Variable

The standard factory overhead rate is $7.50 per machine hour ($6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of the normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: Variable

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The standard factory overhead rate is $7.50 per machine hour ($6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of the normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: Actual: Standard hours allowed for units produced: Variable factory overhead Fixed factory overhead 60,000 hours $360,000 104,000 What is the amount of the variable factory overhead controllable variance? $12,000 unfavorable $12,000 favorable $14,000 unfavorable $26,000 unfavorable
Transcribed Image Text:The standard factory overhead rate is $7.50 per machine hour ($6.20 for variable factory overhead and $1.30 for fixed factory overhead) based on 100% of the normal capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows: Actual: Standard hours allowed for units produced: Variable factory overhead Fixed factory overhead 60,000 hours $360,000 104,000 What is the amount of the variable factory overhead controllable variance? $12,000 unfavorable $12,000 favorable $14,000 unfavorable $26,000 unfavorable
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