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

question 28

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)$11,770 F
• B)$2,200 F
• C)$7,975 U
• D)$5,775 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 three-variance approach,what is the efficiency variance?

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Definitions:

Organization

A structured group of individuals working together to achieve common goals or objectives, often characterized by a set hierarchy or operating system.

Maslow

Abraham Maslow was an American psychologist best known for creating Maslow's hierarchy of needs, a theory of psychological health predicated on fulfilling innate human needs in priority, culminating in self-actualization.

Herzberg

Related to Frederick Herzberg's Motivation-Hygiene Theory, which suggests that job satisfaction and dissatisfaction stem from different factors.

McGregor

Refers to Douglas McGregor's Theory X and Theory Y, which describe two contrasting models of workforce motivation and management.