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Puvo, Inc, Manufactures a Single Product in Which Variable Manufacturing Overhead

question 20

Multiple Choice

Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: During March, the following activity was recorded by the company:
The company produced 2,400 units during the month.
A total of 19,400 pounds of material were purchased at a cost of $13,580.
There was no beginning inventory of materials on hand to start the month; at the end of the month, 3,620 pounds of material remained in the warehouse.
During March, 1,090 direct labor-hours were worked at a rate of $30.50 per hour.
Variable manufacturing overhead costs during March totaled $14,061.
The direct materials purchases variance is computed when the materials are purchased.
The variable overhead efficiency variance for March is:

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Definitions:

Owner's Equity

The residual interest in the assets of the entity after subtracting liabilities, essentially representing the owner's claim against the company's assets.

Initial Investment

The initial amount of money put into a project or venture at its inception.

Computer Equipment

Hardware used in the processing, storage, and display of data, including computers, servers, monitors, and related peripherals.

Accounting Records

Documentation and books that keep track of all financial transactions, assets, liabilities, income, and expenses of a business.