Sigorny Company Uses Standard Costing and Applies Overhead on the Basis

question 6

Multiple Choice

Sigorny Company uses standard costing and applies overhead on the basis of units produced. The company provided the following for July: $\begin{array}{lr}\text { Predetermined overhead rate per unit produced } & \$ 6.20 \\\text { Budgeted fixed overhead } & \$ 12,600 \\\text { Variable overhead budgeted per unit } & \$ 2.00 \\\text { Actual units produced } & 3,100\end{array}$ How much is the budgeted variable overhead in July?

• A) $18,600
• B) $6,200
• C) $19,220
• D) $6,000

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Definitions:

Receiving Report

A document usually prepared by the receiving department detailing the goods received by a business, which is then used to verify invoices before payment.

Period Costs

Expenses that are not directly tied to the production of goods or services and are expensed within the period they occur.

Production Process

The sequence of operations or activities involved in converting materials into finished goods or services.

Balance Sheet

A financial statement that provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity.