Castinata Co

question 115

Multiple Choice

Castinata Co. uses a standard job cost system and a denominator volume of 25,000 direct labour hours for allocating overhead. The actual output was 12,000 units, which cost $185,700 for direct labour (23,000 hours) , $28,000 for variable overhead, and $150,000 for fixed overhead.
The standard variable overhead per unit is $2 (2 hours @ $1 per hour) , and the standard fixed overhead per unit is $10 (2 hours @ $5 per hour) .
All variances are immaterial and are closed to Cost of Sales at the end of the period.
The entry to close the fixed overhead variances includes a:

• A) Credit to work in process for $120,000
• B) Debit to Cost of Sales for $30,000
• C) Credit to Cost of Sales for $30,000
• D) Debit to the fixed overhead production volume variance for $5,000

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Definitions:

Population Mean

The mean value of every number within a given population.

Population Proportion

The fraction or percentage of a population that displays a particular attribute or characteristic.

Margin of Error

A measure indicating the range of values above and below a sample statistic in a confidence interval.

Point Estimate

A single value derived from sample data that serves as a best guess or best estimate of a population parameter.