The Following Data Is Given for the Walker Company Overhead Is Applied on Standard Labor Hours

question 52

Multiple Choice

The following data is given for the Walker Company: $\begin{array}{ll}1,000 \text { units } & \text { Budgeted prochuction } \\980 \text { units } & \text { Actual production }\\\$2.00& \text { Stendard price per Ib } &\\12& \text { Standard pounds per completed unit } &\\11,800& \text {Actual pounds purchased and used in production } &\\\$23,000& \text { Actual price paid for materials } &\\& \text {Labor: } \\\$ 14 \text { per hour } & \text { Standard hourly labor rate } \\4.5 & \text { Standard hours allowed per completed unit } \\4,560 & \text { Actual labor hours worked } \\\$ 62.928 & \text { Actual total labor costs }\\& \text { Overhead: } \\ \$ 27,000 & \text { Actual and budgeted fixed overhead } \\\$ 3.50 \text { per standard direct labor hour }& \text { Standard variable overhe ad rate }\\\$ 15.500&\text { Actual variable overhead costs }\end{array}$

Overhead is applied on standard labor hours.
The variable factory overhead controllable variance is:

• A) $65 unfavorable.
• B) $65 favorable.
• C) $250 unfavorable.
• D) $250 favorable.

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Definitions:

3-D Printers

Machines that create three-dimensional objects by adding material layer by layer, based on digital models, revolutionizing manufacturing and prototyping.

Fixed Costs

Costs that do not change with the level of production or output in the short term, such as rent or salaries.

Minimum Efficient Scale

Minimum efficient scale represents the smallest amount of production a company can achieve while still taking full advantage of economies of scale in terms of costs per unit.

Industry

A group of companies that produce similar products or services and compete in the same market.