Boone Manufacturing had worked on two jobs, Job 101 and Job 102 last year. The estimated manufacturing overhead for last year was P 30,000 (fixed) and P5.00 per direct labor hour (variable) and estimated 2,000 direct labor hours. The factory overhead control account has a balance of P 37,000. Actual hours used for Job 101 was 1,200 and for Job 102 was 1,000. 3. What is the total spending variance? a. P4,000 unfavorable b. P3,000 unfavorable c. P4,000 favorable
Boone Manufacturing had worked on two jobs, Job 101 and Job 102 last year. The estimated manufacturing overhead for last year was P 30,000 (fixed) and P5.00 per direct labor hour (variable) and estimated 2,000 direct labor hours. The factory overhead control account has a balance of P 37,000. Actual hours used for Job 101 was 1,200 and for Job 102 was 1,000. 3. What is the total spending variance? a. P4,000 unfavorable b. P3,000 unfavorable c. P4,000 favorable
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 17MC: When is the direct labor time variance unfavorable? A. when the actual quantity used is greater than...
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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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