Desue Corporation Makes a Product with the Following Standards for Labor

question 151

Multiple Choice

Desue Corporation makes a product with the following standards for labor and variable overhead: The company budgeted for production of 6, 500 units in December, but actual production was 6, 300 units.The company used 610 direct labor-hours to produce this output.The actual variable overhead rate was $6.40 per hour.The company applies variable overhead on the basis of direct labor-hours. The variable overhead rate variance for December is:

• A)$366 U
• B)$366 F
• C)$378 F
• D)$378 U

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Definitions:

Decision

The act or process of choosing a particular action among various alternatives based on the expected outcomes.

Residual Income

The income that remains after deducting all costs, expenses, and taxes from total revenues.

Divisonal Operating Income

The profit generated by a specific division within a company, calculated as the difference between the division's revenues and operating expenses.

Profit Margin

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating the profitability of a company.