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39. Will rate Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: Denominator volumenumber

39. Will rate

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019:

Denominator volumenumber of units 6,000
Denominator volumepercent of capacity 60 %
Denominator volumestandard direct labor hours (DLHs) 18,000
Budgeted variable factory overhead cost at denominator volume $ 102,100
Total standard factory overhead rate per DLH $ 15.10

During 2019, Bluecap worked 26,000 DLHs and manufactured 9,100 units. The actual factory overhead cost for the year was $17,000 greater than the flexible budget amount for the units produced, of which $7,000 was due to fixed factory overhead. In preparing a budget for 2020 Bluecap decided to raise the level of operation to 90% of capacity (a level it considers to be "practical capacity"), to manufacture 8,500 units at a budgeted total of 25,500 DLHs. The total overhead variance in 2019 for Bluecap Co., to the nearest whole dollar, was: (Round your intermediate calculation to 2 decimal places.)

Multiple Choice

  • $17,000 unfavorable.

  • $47,899 favorable.

  • $50,139 favorable.

  • $70,699 favorable.

  • $70,699 unfavorable.

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