Question
When analyzing the total variable overhead cost variance into both spending and efficiency variances, it is often assumed that direct labour hours is the sole
When analyzing the total variable overhead cost variance into both spending and efficiency variances, it is often assumed that direct labour hours is the sole cost driver.
Required:
Explain
1) if direct labour costs could ever be a better cost driver of variable overhead costs than direct labour hours.
- 2) How is the standard variable overhead rate different from the standard labour rate in variance analysis? Explain.
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a Direct labor cost can be a better cost driver than direct labor hour For example in a manufacturin...Get Instant Access to Expert-Tailored Solutions
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, And Terry D. Warfield
13th Edition
9780470374948, 470423684, 470374942, 978-0470423684
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