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Ainat [17]
2 years ago
7

The following data have been provided by Liggett Corporation: Budgeted production 7,400 units Standard machine-hours per unit 6.

6 machine-hours Standard lubricants rate $ 3.50 per machine-hour Standard supplies rate $ 2.00 per machine-hour Actual production 7,600 units Actual machine-hours (total) 49,840 machine-hours Actual lubricants cost (total) $ 179,821 Actual supplies cost (total) $ 98,933 Lubricants and supplies are both elements of variable manufacturing overhead. The variable overhead rate variance for lubricants is closest to:
Multiple Choice
a. $1,120 F
b. $5,381 F
c. $4,261 U
d. $5,381 U
Business
1 answer:
abruzzese [7]2 years ago
5 0

Answer:

The correct answer is D.

Explanation:

Giving the following information:

Budgeted production 7,400 units Standard machine-hours per unit 6.6 machine-hours Standard lubricants rate $ 3.50 per machine-hour

Actual production 7,600 units Actual machine-hours (total) 49,840 machine-hours Actual lubricants cost (total) $ 179,821

Manufacturing overhead spending variance= (standard rate - actual rate)* actual quantity

Manufacturing overhead spending variance= (3.5 - 3.607965)*49,840= 5,381 unfavorable

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