Franklin Glass Works Uses a Standard Cost System in Which

question 83

Multiple Choice

Franklin Glass Works uses a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours. Each unit requires two standard hours of direct labor for completion. The denominator activity for the year was based on budgeted production of 200,000 units. Total overhead was budgeted at $900,000 for the year, and the fixed manufacturing overhead rate was $1.50 per direct labor-hour. The actual data pertaining to the manufacturing overhead for the year are presented below:
-The standard hours allowed for actual production for the year total:

• A)247,500
• B)396,000
• C)400,000
• D)495,000

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Definitions:

Stock Dividend

A dividend payment made in the form of additional shares rather than a cash payout.

Stock Split

An increase in a firm’s shares outstanding without any change in owner’s equity.

Retained Earnings

Profit that is not distributed to the shareholders but is kept by the company for future investment or to pay off debt.