Somalian Corporation Uses a Standard Costing System The Factory Overhead Rate Is Based on a Normal Volume

question 97

Multiple Choice

Somalian Corporation uses a standard costing system. Information for the month of May is as follows: $\begin{array}{ll}\text { Actual manufacturing overhead costs }(\$ 26,000 \text { is fixed) } & \$ 80,000 \\\text { Direct labor: } & \\\text { Actual hours worked } & 12,000 \text { hrs. } \\\text { Standard hours allowed for actual production } & 10,000 \text { hrs. } \\\text { Average actual labor cost per hour } & \$ 18\end{array}$
The factory overhead rate is based on a normal volume of 12,000 direct labor hours. Standard cost data at 12,000 direct labor hours were as follows:

$\begin{array}{lr}\text { Variable factory overhead } & \$ 48,000 \\\text { Fixed factory overhead } & 24,000 \\\text { Total factory overhead } & \underline{\mathbf{\$ 72}, 000}\end{array}$ What is the variable overhead efficiency variance for Somalian?

• A)$2,000 (U)
• B)$20,000 (U)
• C)$4,000 (U)
• D)$8,000 (U)

Recognize the legal implications of business practices and the distinction between ethical and legal behaviors.

Identify ethical dilemmas and understand ethical behavior in business practices.

Understand the implications of public opinion on the perception of ethical standards in various professions.

Recognize the importance of ethics in marketing and business decisions.

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Definitions:

Industry Versus Inferiority

Erikson's fourth stage of psychosocial development, focusing on the conflict between mastery of tasks and feelings of inadequacy during childhood.

Initiative Versus Guilt

This is a stage in Erik Erikson's theory of psychosocial development where children aged around 3-6 years learn to initiate activities and interact with others or develop guilt over their actions and decisions.

Autonomy Versus Shame

A stage in Erik Erikson's psychosocial development theory where toddlers learn to exercise will and do things independently, or doubt their abilities.

Healthy Family

A family system that functions in a supportive, loving, and constructive manner, promoting the well-being of all members.