Candy Factory Uses the Following Standard Costs for a Single

question 49

Multiple Choice

Candy Factory uses the following standard costs for a single unit of product: Actual data for the month showed overhead costs of $475,000 for 26,300 units produced. What is the difference between actual overhead costs and standard overhead costs allocated to products?

• A)$317,200 favorable
• B)$317,200 unfavorable
• C)$314,000 favorable
• D)$314,000 unfavorable

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Definitions:

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting the loss of value due to age, wear, and tear, or obsolescence.

Accrue Interest

The process of recognizing interest earned or incurred on an outstanding debt over a period of time.

Reversing Entries

Journal entries made at the beginning of an accounting period to reverse or cancel out adjusting entries made at the end of the previous accounting period, simplifying the recording of transactions.

Liability Account

An account on a company's balance sheet that records debts or obligations the company needs to pay in the future.