The Phelps Company Applies Overhead Costs to Products on the Basis

question 38

Multiple Choice

The Phelps Company applies overhead costs to products on the basis of standard direct labor-hours. The standard cost card shows that 5 direct labor-hours are required per unit of product. Phelps Company had the following budgeted and actual data for March: The budgeted direct labor-hours is used as the denominator activity for the month.
-The variable overhead rate variance for March is:

• A)$7,000 unfavorable
• B)$9,000 unfavorable
• C)$13,000 unfavorable
• D)$11,000 unfavorable

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