Sade Inc.has provided the following data concerning one of the products in its standard cost system.Variable manufacturing overhead is applied to products on the basis of direct labor-hours.
The company has reported the following actual results for the product for December:
Required:
a.Compute the variable overhead rate variance for December.
b.Compute the variable overhead efficiency variance for December.
Definitions:
Out-of-pocket Cost
Expenses that require immediate cash payment by an individual or company.
Future Outlay
Potential future spending or investments that a company plans to make, which may impact its financial position.
Opportunity Cost
The lost potential gain from other alternatives when one alternative is chosen.
Potential Benefit
The prospective advantage or gain that may be realized from a specific action or decision, often considered in planning and analysis.
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