The data below relate to the month of November for Badong, Inc. which uses a standard cost system: Actual direct labor cost, P43,400 Actual hours used, 14,000 Direct labor rate variance - debit, 1,400 Actual total overhead, 32,000 Budgeted fixed cost, 9,000 Standard hours allowed for good output, 15,000 Normal activity in hours, 12,000 Total application rate per standard direct labor hour, 2.25 Badong uses a two-way analysis of overhead variance. What was Badong's direct labor usage variance for November? A.P3,200 favorable B.P3,000 unfavorable C.P3,200 unfavorable D.P3,000 favorable
The data below relate to the month of November for Badong, Inc. which uses a standard cost system: Actual direct labor cost, P43,400 Actual hours used, 14,000 Direct labor rate variance - debit, 1,400 Actual total overhead, 32,000 Budgeted fixed cost, 9,000 Standard hours allowed for good output, 15,000 Normal activity in hours, 12,000 Total application rate per standard direct labor hour, 2.25 Badong uses a two-way analysis of overhead variance. What was Badong's direct labor usage variance for November? A.P3,200 favorable B.P3,000 unfavorable C.P3,200 unfavorable D.P3,000 favorable
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 7PB: Marymount Company makes one product. In the month of April, it made 3,500 units. Workers were paid...
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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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The data below relate to the month of November for Badong, Inc. which uses a standard cost system:
Actual direct labor cost, P43,400
Actual hours used, 14,000
Direct labor rate variance - debit, 1,400
Actual total overhead, 32,000
Budgeted fixed cost, 9,000
Standard hours allowed for good output, 15,000
Normal activity in hours, 12,000
Total application rate per standard direct labor hour, 2.25
Badong uses a two-way analysis of overhead variance.
What was Badong's direct labor usage variance for November?
A.P3,200 favorable
B.P3,000 unfavorable
C.P3,200 unfavorable
D.P3,000 favorable
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