A Manufacturing Company Has a Standard Costing System Based on Direct

question 59

Multiple Choice

A manufacturing company has a standard costing system based on direct labour-hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: $\begin{array}{lrr} \text { Denominator level of activity } &3,700&\text { DLHs }\\ \text { Overhead costs at the denominator activity level: } &\\ \text { Variable overhead cost } &£ 28,490\\ \text { Fixed owerhead cost } &£ 47,545\\ \text { The following data pertain to operations for the most recent period:} &\\ \text { Actual hours } &3,900&\text { DLHs }\\ \text { Standard hours 3,900allowed for the actual output } &3,850&\text { DLHs }\\ \text { Actual total variable overhead cost } &£ 29,445\\ \text {Actual total fixed overhead cost } &£47,995 \\\end{array}$


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What was the fixed overhead budget variance for the period to the nearest pound

• A)£615 F
• B)£2,120 U
• C)£1,478 U
• D)£450 U

Calculate overhead cost per unit using ABC.

Identify appropriate cost drivers for allocating overhead costs.

Compute departmental overhead rates.

Apply overhead costs to products using departmental and plantwide rates.

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Definitions:

Ethnic Diversity

The inclusion of individuals from a variety of ethnic, racial, and cultural backgrounds within a group or organization.

High-Context Culture

A culture in which communication is often indirect and the context in which a message is delivered is as important as the message itself.

National Stereotype

Widely held but fixed and oversimplified image or idea of a particular type of person or thing associated with a country or nation.

Multicultural Identity

The identification with or sense of belonging to several cultural or ethnic groups.