The Following Standards for Variable Manufacturing Overhead Have Been Established

question 319

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 efficiency variance for the month?

• A) $7,600 Favorable
• B) $2,835 Favorable
• C) $7,600 Unfavorable
• D) $7,425 Unfavorable

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Definitions:

Zero-Coupon Bond

A type of bond that does not pay periodic interest and is sold at a discount from its face value, with the full face value being paid at maturity.

Implicit Interest

The interest represented by the difference between the cash price of a product and the amount financed over time, not directly stated as an interest rate.

Face Value

The nominal or dollar value of a security stated by the issuer, which is the amount paid back to the holder at maturity.

Zero-Coupon Bond

A type of bond that does not pay periodic interest payments and is sold at a discount from its face value, with the full face value being paid at maturity.