Hallow Company Uses Standard Costing A $\quad$ Calculate the Variable Overhead Rate

question 83

Essay

Hallow Company uses standard costing.Overhead is applied to products on the basis of standard direct labour hours for actual production.Data for Hallow follows: $\begin{array}{lr}\text { Standard direct labour hours allowed for actual output } & 110,000 \\\text { Actual direct labour hours } & 115,000 \\\text { Direct labour hours budgeted in the master budget } & 120,000 \\\text { Budgeted total variable overhead cost } & \$ 360,000 \\\text { Actual variable overhead cost } & \$ 328,000\end{array}$ A. $\quad$ Calculate the variable overhead rate.
B. $\quad$ Calculate the total variable overhead applied to production.
C. $\quad$ Calculate the variable overhead spending variance.
D. $\quad$ Calculate the variable overhead efficiency variance.
E. $\quad$ Calculate the total variable overhead variance.

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Definitions:

Manufacturing Departments

Divisions within a manufacturing facility, each specializing in different aspects of the production process.

Job-Order Costing System

A costing method that accumulates manufacturing costs separately for each job.

Direct Labor Cost

The total expense that a company incurs for labor directly involved in the production of goods or services, including wages and benefits.

Machine-Hours

A measure of production time, tracking how many hours machines are operating in the manufacturing process.