Pearce Company Pearce Company Uses a Standard Cost System for Its Production

question 11

Multiple Choice

Pearce Company
Pearce Company uses a standard cost system for its production process.Pearce Company applies overhead based on direct labor hours.The following information is available for July:

• A)$9,570 F
• B)$9,570 U
• C)$2,200 F
• D)$2,200 U

Standard:
DLH per unit	2.20
Variable overhead per DLH	$2.50
Fixed overhead per DLH
Budgeted variable overhead	$3.00
(based on 11,990 DLHs)

Actual:
Units produced	4,400
Direct labor hours	8,800
Variable overhead	$29,950
Fixed overhead	$42,300

Refer to Pearce Company Using the four-variance approach,what is the variable overhead efficiency variance?

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Definitions:

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