Eliezrie Corporation Makes a Product with the Following Standard Costs

question 247

Multiple Choice

Eliezrie Corporation makes a product with the following standard costs: In January the company's budgeted production was 7,400 units but the actual production was 7,500 units.The company used 45,580 kilos of the direct material and 2,030 direct labor-hours to produce this output.During the month,the company purchased 48,500 kilos of the direct material at a cost of $53,350.The actual direct labor cost was $18,473 and the actual variable overhead cost was $7,714. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased.
The variable overhead rate variance for January is:

• A)$406 F
• B)$450 F
• C)$406 U
• D)$450 U

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Definitions:

Transferable Permits

Transferable permits are regulatory instruments that allow the holder to emit a certain amount of pollution or use a certain amount of a resource; they can be bought and sold, creating a market for these permits.

Transferable Emissions Permit

A market-based approach to controlling pollution by providing economic incentives for achieving reductions in the emissions of pollutants, allowing entities to buy, sell, or trade permits.

Marginal Cost

The increase in total cost that arises from producing one additional unit of a good or service.

Abatement

The reduction in the degree or intensity of pollution.