Reference: 11-11
the Clark Company Makes a Single Product and Uses

question 78

True/False

Reference: 11-11
The Clark Company makes a single product and uses standard costing. Variable overhead is assigned to production on the basis of direct labour hours. Some data concerning this product for the month of May follow: $$\begin{array} { | l | l | l | } \hline \text { Labour rate variance: } & \$ 7,000 & \mathrm {~F} \\\hline \text { Labour efficiency variance: } & \$ 12,000 & \mathrm {~F} \\\hline \text { Variable overhead efficiency variance: } & \$ 4,000 & \mathrm {~F} \\\hline \text { Number of units produced: } & 10,000 & \\\hline \text { Standard labour rate per direct labour hour: } & \$ 12 & \\\hline \text { Standard variable overhead rate per direct labour hour: } & \$ 4 & \\\hline \text { Actual labour hours used: } & 14,000 & \\\hline \text { Actual variable manufacturing overhead costs: } & \$ 58,290 & \\\hline\end{array}$$
-Analysis of all sales volume variances provides no useful information to management.

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Definitions:

Europeans

People from the continent of Europe or of European descent.

Furs

Textiles made from the pelts of animals, historically significant in trade and fashion, but have become controversial due to ethical concerns regarding animal rights.

Exploratory Voyages

Journeys undertaken by explorers to discover unknown lands, map new territories, and establish contacts.

English Colonization

The process of English settlement and establishment of control over regions in North America, the Caribbean, and other parts of the world from the late 16th to the early 18th centuries.