Use the following to answer questions 71-74: Pohl Company uses a standard cost system in which manufacturing overhead is applied to units of product on the basis of standard machine-hours. For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20,000 machine-hours: Variable overhead costs (total): Maintenance.... $16,000 Utilities... $10,000 Fixed overhead costs (total): Supervision.... $20,500 Depreciation... $9,500 During June, 17,000 machine-hours were used to complete 13,000 units of product, and the following actual total overhead costs were incurred: Variable overhead costs (total): Maintenance.. $14,620 Utilities....... $10,710 Fixed overhead costs (total): $19,320 Supervision.... Depreciation. $9,500 At standard, each unit of finished product requires 1.4 hours of machine time. 71. The variable overhead spending variance for maintenance cost for June was A) $1,020 F B) $1,020 U C) $3,230 F D) $3,230 U
Use the following to answer questions 71-74: Pohl Company uses a standard cost system in which manufacturing overhead is applied to units of product on the basis of standard machine-hours. For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20,000 machine-hours: Variable overhead costs (total): Maintenance.... $16,000 Utilities... $10,000 Fixed overhead costs (total): Supervision.... $20,500 Depreciation... $9,500 During June, 17,000 machine-hours were used to complete 13,000 units of product, and the following actual total overhead costs were incurred: Variable overhead costs (total): Maintenance.. $14,620 Utilities....... $10,710 Fixed overhead costs (total): $19,320 Supervision.... Depreciation. $9,500 At standard, each unit of finished product requires 1.4 hours of machine time. 71. The variable overhead spending variance for maintenance cost for June was A) $1,020 F B) $1,020 U C) $3,230 F D) $3,230 U
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
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Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 72P: Moleno Company produces a single product and uses a standard cost system. The normal production...
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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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![Use the following to answer questions 71-74:
Pohl Company uses a standard cost system in which manufacturing overhead is applied to
units of product on the basis of standard machine-hours. For June, the company's
manufacturing overhead flexible budget showed the following total budgeted costs at a
denominator activity level of 20,000 machine-hours:
Variable overhead costs (total):
Maintenance.
$16,000
Utilities.
$10,000
Fixed overhead costs (total):
Supervision.....
$20,500
Depreciation.
$9,500
During June, 17,000 machine-hours were used to complete 13,000 units of product, and the
following actual total overhead costs were incurred:
Variable overhead costs (total):
Maintenance.
$14,620
Utilities......
$10,710
Fixed overhead costs (total):
$19,320
Supervision...
Depreciation.
$9,500
At standard, each unit of finished product requires 1.4 hours of machine time.
71. The variable overhead spending variance for maintenance cost for June was
A) $1,020 F
B) $1,020 U
C) $3,230 F
D) $3,230 U](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa43ff9e7-1f28-4706-a372-72c39de156b8%2F51e0b70d-89c1-4407-90c4-e2371a978509%2Fi7hbgxx_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Use the following to answer questions 71-74:
Pohl Company uses a standard cost system in which manufacturing overhead is applied to
units of product on the basis of standard machine-hours. For June, the company's
manufacturing overhead flexible budget showed the following total budgeted costs at a
denominator activity level of 20,000 machine-hours:
Variable overhead costs (total):
Maintenance.
$16,000
Utilities.
$10,000
Fixed overhead costs (total):
Supervision.....
$20,500
Depreciation.
$9,500
During June, 17,000 machine-hours were used to complete 13,000 units of product, and the
following actual total overhead costs were incurred:
Variable overhead costs (total):
Maintenance.
$14,620
Utilities......
$10,710
Fixed overhead costs (total):
$19,320
Supervision...
Depreciation.
$9,500
At standard, each unit of finished product requires 1.4 hours of machine time.
71. The variable overhead spending variance for maintenance cost for June was
A) $1,020 F
B) $1,020 U
C) $3,230 F
D) $3,230 U
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