Question
The Lustre Company produces its only product, Kool Chewing Gum.The standard overhead cost for one pack of the product follows: Fixed overhead (1.50 hours at
The Lustre Company produces its only product, Kool Chewing Gum.The standard overhead cost for one pack of the product follows:
Fixed overhead (1.50 hours at P18.00) P27.00
Variable overhead (1.50 hours at P10.00) 15.00
Total application rate P42.00
Lustre uses expected volume of 20,000 units.During the year, Lustre used 31,500 direct labor hours for the production of 20,000 units.Actual overhead costs were P545,000 fixed and P308,700 variable.
71.The amount of variable overhead spending variance is
A.P6,300 FavorableC.P6,300 Unfavorable
B.P 8,700 FavorableD.P8,700 Unfavorable
72.The total overhead controllable variance is
A.P13,700 FavorableC.P13,700 Unfavorable
B.P8,700 FavorableD.P8, 700 Unfavorable
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