Luke,IncHas a Standard Variable Overhead Rate of $5 Per Machine

question 51

Multiple Choice

Luke,Inc.has a standard variable overhead rate of $5 per machine hour,with each completed unit expected to take three machine hours to produce.A review of the company's accounting records found the following:
Actual production: 19,500 units
Variable-overhead efficiency variance: $9,000U
Variable-overhead spending variance: $21,000F
What was Luke's actual variable overhead during the period?

• A)$262,500.
• B)$280,500.
• C)$304,500.
• D)$322,500.
• E)Some other amount.

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Definitions:

Composition

The way in which different components or elements are organized or arranged.

Fixed Cost

Expenses that do not change in proportion to the level of goods or services produced by a business.

Author Royalties

Author royalties are payments made by publishers to authors for the right to use, produce, or sell the authors' creations, usually a percentage of sales.

Fixed Cost

Expenses that do not change in relation to the level of goods or services produced over a certain period.