Question
Pippin Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on
Pippin Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours.
| Inputs | Standard Quantity or Hours per Unit of Output | Standard Price or Rate | |||||||||
| Direct materials | 5.0 | grams | $ | 7.00 | per gram | ||||||
| Direct labor | 0.30 | hours | $ | 21.30 | per hour | ||||||
| Variable manufacturing overhead | 0.30 | hours | $ | 9.60 | per hour | ||||||
The company has reported the following actual results for the product for June:
| Actual output | 8,500 | units | |
| Raw materials purchased | 48,100 | grams | |
| Actual price of raw materials | $ | 7.70 | per gram |
| Raw materials used in production | 42,490 | grams | |
| Actual direct labor-hours | 2,300 | hours | |
| Actual direct labor rate | $ | 21.70 | per hour |
| Actual variable overhead rate | $ | 9.80 | per hour |
The labor efficiency variance for the month is closest to:
Multiple Choice
-
$5,325 U
-
$5,425 F
-
$5,425 U
-
$5,325 F
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Auditing Your Information Systems And IT Infrastructure Practical Audit Programs Checklists For Internal Auditors
Authors: Nwabueze Ohia
1st Edition
1973136260, 978-1973136262
