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Luxury Clothing is a manufacturer of designer suits. The cost of each suit is the sum of three variable costs (direct materials costs, direct manufacturing
Luxury Clothing is a manufacturer of designer suits. The cost of each suit is the sum of three variable costs (direct materials costs, direct manufacturing labour costs, and manufacturing overhead costs) and one fixed-cost category (manufacturing overhead costs). Variable manufacturing overhead (VMOH) cost is allocated to each suit based on budgeted direct manufacturing labour-hours (DMLH) per suit. For June, each suit is budgeted to take 4 labour-hours. Budgeted VMOH costs per labour-hour is $12.00. The budgeted number of suits to be manufactured in June is 1,120 . Actual VMOH costs in June were $59,150 for 1,100 suits started and completed. There was no beginning or ending inventory of suits. Actual DMLH for June were 4,550. Required 1. Calculate the flexible-budget variance, the rate variance, and the efficiency variance for VMOH. 2. Comment on the results. Requirement 1. Calculate the flexible-budget variance, the rate variance, and the efficiency variance for VMOH Begin by computing the following amounts for the VMOH. (Round your answers to the nearest whole dollar.)
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