The related data of Danaya Company: Actual direct labor hours 10,000 Actual overhead cost P893,200 Underapplied factory overhead 125,700 Factory overhead is based on direct labor hours. How much is the predetermined rate?
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.
The related data of Danaya Company:
Actual direct labor hours 10,000
Actual
Underapplied factory overhead 125,700
Factory overhead is based on direct labor hours.
How much is the predetermined rate?
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