Wharton Tooling Uses a Standard Cost System to Account for the Costs

question 70

Essay

Wharton Tooling uses a standard cost system to account for the costs of its one product.Variable overhead standards are 14 hours of labor at a standard rate of $9.Fixed overhead is applied at a rate of $150 per unit,based on budgeted production of 650 units.During July,Wharton Tooling produced 600 units.Payroll totaled $112,930 for 8,770 hours worked.Overhead incurred was $77,490 variable and $98,750 fixed.Calculate the:
a.variable overhead rate variance.
b.variable overhead efficiency variance.
c.fixed overhead spending variance.

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Definitions:

Revaluation

The process of adjusting the carrying value of an asset or liability to reflect its current market value.

Journal Entries

Records that detail all the financial transactions of a business, used in the double-entry bookkeeping system.

Accounting Standards for Private Enterprises

Specific accounting guidelines tailored for private companies to ensure transparency, comparability, and clarity in financial reporting.

Dividends

Distributions of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.