The variable overhead expenditure andefficiency variances are:PQR has prepared the following standard cost information for one unit ofproduct X:Direct materials2 kg @ $13/kgDirect labour3.3 hours @ $12/hourVariable overheads3.3 hours @ $2.50Actual results for the period were recorded as follows:12,000 unitsProductionMaterials - 26,400 kgLabour - 40,200 hoursVariable overheads$336,600$506,520$107,250*$26.00$39.60$8.25

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Description: The variable overhead expenditure andefficiency variances are:PQR has prepared the following standard cost information for one unit ofproduct X:Direct materials2 kg @ $13/kgDirect labour3.3 hours @ $12/hourVariable overheads3.3 hours @ $2.50Actual r

Variance analysis is one of the technique used for management accounting. Under this, all standard…

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The variable overhead expenditure and efficiency variances are: PQR has prepared the following standard cost information for one unit of product X: Direct materials 2 kg @ $13/kg 3.3 hours @ $12/hour 3.3 hours @ $2.50 Direct labour Variable overheads Actual results for the period were recorded as follows: 12,000 units $336,600 $506,520 $107,250 Production Materials - 26,400 kg Labour - 40,200 hours Variable overheads * $26.00 $39.60 $8.25

The variable overhead expenditure and efficiency variances are: PQR has prepared the following standard cost information for one unit of product X: Direct materials 2 kg @ $13/kg 3.3 hours @ $12/hour 3.3 hours @ $2.50 Direct labour Variable overheads Actual results for the period were recorded as follows: 12,000 units $336,600 $506,520 $107,250 Production Materials - 26,400 kg Labour - 40,200 hours Variable overheads * $26.00 $39.60 $8.25

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

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Question

The variable overhead expenditure and
efficiency variances are:
PQR has prepared the following standard cost information for one unit of
product X:
Direct materials
2 kg @ $13/kg
Direct labour
3.3 hours @ $12/hour
Variable overheads
3.3 hours @ $2.50
Actual results for the period were recorded as follows:
12,000 units
Production
Materials - 26,400 kg
Labour - 40,200 hours
Variable overheads
$336,600
$506,520
$107,250
*
$26.00
$39.60
$8.25

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