Deschamp Corporation's Variable Overhead Is Applied on the Basis of Direct

question 312

Essay

Deschamp Corporation's variable overhead is applied on the basis of direct labor-hours.The company has established the following variable overhead standards for product O28H: The following data pertain to the most recent month's operations during which 2,160 units of product O28H were made: Required:
a.What was the variable overhead rate variance for the month?
b.What was the variable overhead efficiency variance for the month?

---

Definitions:

Price Elastic Demand

Describes a situation where the quantity demanded of a good or service significantly changes in response to a change in its price.

Close Substitutes

Goods or services that can serve as replacements for each other with little loss of utility to the consumer.

OPEC Oil Cartel

An international organization of oil-producing countries that coordinates and unifies the petroleum policies of its member states to stabilize oil markets and prices.

Inelastic

Describing demand that does not significantly change with the price changes of a good or service.