MC Qu. 108 Hurren Corporation makes a product with the following standard costs: ...
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Accounting
MC Qu. 108 Hurren Corporation makes a product with the following standard costs:
Hurren Corporation makes a product with the following standard costs:
Standard Quantity or Hours
Standard Price or Rate
Standard Cost Per Unit
Direct materials
5.0 grams
$4.00 per gram
$20.00
Direct labor
0.8 hours
$15.00 per hour
$12.00
Variable overhead
0.8 hours
$4.00 per hour
$3.20
The company reported the following results concerning this product in June.
Originally budgeted output
6,200
units
Actual output
6,100
units
Raw materials used in production
28,440
grams
Actual direct labor-hours
4,600
hours
Purchases of raw materials
32,400
grams
Actual price of raw materials purchased
$4.10
per gram
Actual direct labor rate
$15.90
per hour
Actual variable overhead rate
$3.70
per hour
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The variable overhead efficiency variance for June is:
$1,120 U
$1,036 U
$1,036 F
$1,120 F
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