Miguez Corporation Makes a Product with the Following Standard Costs

question 52

Multiple Choice

Miguez Corporation makes a product with the following standard costs:
The company budgeted for production of 2,600 units in September, but actual production was 2,500 units. The company used 5,440 liters of direct material and 1,680 direct labor-hours to produce this output. The company purchased 5,800 liters of the direct material at $7.20 per liter. The actual direct labor rate was $24.10 per hour and the actual variable overhead rate was $1.90 per hour.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
-The variable overhead efficiency variance for September is:

• A) $140 U
• B) $140 F
• C) $133 F
• D) $133 U

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Definitions:

Immigrants

People who come to live permanently in a foreign country from their country of origin.

Pure Capitalism

An economic system characterized by the private ownership of resources and the use of prices to coordinate economic activity in unregulated markets.

Economic Question

A query that addresses how to allocate scarce resources to satisfy unlimited wants and needs.

Invisible Hand

A metaphor for the self-regulating nature of the marketplace that guides individuals to unintentionally benefit society through the pursuit of their own interests.