Luther Manufacturing Company Uses a Standard Cost System and Prepared

question 34

Multiple Choice

Luther Manufacturing Company uses a standard cost system and prepared the following budget at normal capacity for October: $\begin{array}{ll}\text { Direct labor hours } & 24,000 \\\text { Variable OH } & \$ 48,000 \\\text { Fixed OH } & \$ 108,000 \\\text { Total OH per DLH } & \$ 6.50\\\\\textbf { Actual data for October were as follows: }\\\text { Direct labor houss worked } & 22,000 \\\text { Total OH } & \$ 147,000 \\\text { Standard DLHs allowed for capacity attained } & 21,000\end{array}$ Using the two-way analysis of overhead variances,what is the controllable variance for October?

• A)$3,000 F
• B)$5,000 F
• C)$9,000 F
• D)$10,500 U

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Definitions:

Schemas Associated

Mental structures that represent aspects of the world and influence understanding, recognition, and recall by organizing information.

Chinese Language

A group of languages used in China, of which Mandarin is the most widely spoken variety.

Accommodation

In psychology, the process by which individuals adjust their mental frameworks to incorporate new information; in eyesight, the eye's ability to focus on objects at various distances.

Assimilation

The cognitive process by which individuals integrate new information into their existing knowledge structures or schemas.