The Following Standards for Variable Manufacturing Overhead Have Been Established

question 23

Multiple Choice

The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month:
What is the variable overhead rate variance for the month?

• A) $2,724 Unfavorable
• B) $3,492 Unfavorable
• C) $840 Favorable
• D) $768 Unfavorable

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Definitions:

Goodyear

A multinational company known for its tire and rubber products.

Inventory

The complete inventory of products and materials in possession of a business, intended either for production or for selling.

LIFO Method

An inventory valuation method that assumes the last items placed in inventory are the first sold during an accounting year; stands for Last-In, First-Out.

Ending Inventory

The total value of a company's merchandise, raw materials, and finished and unfinished products which have not yet been sold, at the end of an accounting period.