Wriphoff Company Uses a Standard Cost System to Collect Costs

question 68

Multiple Choice

Wriphoff Company uses a standard cost system to collect costs related to the production of its clay bud vases. Manufacturing overhead at Wriphoff is applied to production on the basis of standard direct labor-hours. The overhead standards used at Wriphoff are as follows: The standards above were based on an expected annual volume of 40,000 bud vases or 36,000 direct labor-hours. The actual results for last year were as follows:
-What was Wriphoff's variable overhead rate variance for last year?

• A) $6,850 favorable
• B) $7,294 unfavorable
• C) $14,144 unfavorable
• D) $15,070 unfavorable

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Definitions:

Unwillingness

The state of being reluctant or disinclined to do something.

Ownership

The legal right or title to an asset or property, including the rights to use, enjoy, and dispose of it.

Perfect Tender Rule

A legal principle in sales law that allows buyers to reject goods if they fail to conform precisely to the terms of the contract.

Slightest Defect

Refers to the minimum imperfection or fault in something that can lead to legal liability or the rejection of a product or service.