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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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
Transcribed Image Text:Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct materials: 5 pounds at $9 per pound
Direct labor: 3 hours at $14 per hour
Variable overhead: 3 hours at $8 per hour
Total standard cost per unit
$ 45
42
24
$ 111
The planning budget for March was based on producing and selling 28,000 units. However, during March the company
actually produced and sold 34,000 units and incurred the following costs:
a. Purchased 180,000 pounds of raw materials at a cost of $8.50 per pound. All of this material was used in production.
b. Direct laborers worked 69,000 hours at a rate of $15 per hour.
c. Total variable manufacturing overhead for the month was $565,110.
13. What variable manufacturing overhead cost would be included in the company's flexible budget for March?
Variable manufacturing overhead cost
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