Zacher Corporation Makes a Product with the Following Standards for Direct

question 324

Multiple Choice

Zacher Corporation makes a product with the following standards for direct labor and variable overhead: In February the company's budgeted production was 6,900 units,but the actual production was 7,000 units.The company used 1,980 direct labor-hours to produce this output.The actual variable overhead cost was $10,296.The company applies variable overhead on the basis of direct labor-hours. The variable overhead efficiency variance for February is:

• A)$624 F
• B)$600 F
• C)$624 U
• D)$600 U

---

Definitions:

Direct Materials

Raw materials that can be directly traced to the production of a specific product or service.

Ending Inventory

The financial valuation of items for sale at the conclusion of a financial period, figured by starting with the beginning inventory, adding purchases, and then deducting the cost of goods sold.

Purchased

Refers to goods or services obtained by paying money or its equivalent.

Master Budget

A comprehensive financial planning document that includes all of an organization's budgets, combining sales, production, and financial budgets to project overall financial activities.