Genesis Company Genesis Company Uses a Standard Cost System for Its

question 146

Multiple Choice

Genesis Company Genesis Company uses a standard cost system for its production process and applies overhead based on direct labor hours.The following information is available for September when Genesis produced 5,000 units:
$\begin{array}{ll}\text { Standard: }\\\text { DLH per unit } & 3.00\\\text { Variable overhead per DLH } & \$ 1.80 \\\text { Fixed overhead per DLH } & \$ 3.25 \\\text { Budgeted variable overhead } & \$ 27,250\\\text { Budgeted fixed overhead } & \$ 49,500\\\\\text { Actual: }\\\text {Direct labor hours }&16,000\\\text { Variable overhead}&\$31,325\\\text { Fixed overhead}&\$49,750\\\end{array}$ Refer to Genesis Company.Using the three-variance approach,what is the volume variance?

• A)$ 750 F
• B)$ 750 U
• C)$1,000 U
• D)$1,000 F

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Definitions:

Cost Estimation

The process of forecasting the costs associated with a project or production process before it begins.

Regression Analysis

Regression analysis is a statistical method used to examine the relationship between one dependent variable and one or more independent variables, predicting the former based on the latter.

Regression Analysis

A statistical method that investigates the relationship between a dependent variable and one or more independent variables to forecast outcomes or assess predictions.

Cost Equation

A mathematical formula that relates cost to its determinants, such as output level, activity level, or other cost drivers.