Litchfield Industries gathered the following information for the month ended June 31:
The static budget volume is 5,500 units:
Overhead flexible budget:

Actual production was 12,000 units.Actual overhead costs were $28,000 for variable costs and $37,000 for fixed costs.Actual machine hours worked were 16,000 hours.
What is the standard variable overhead rate per machine hour?

Question

Litchfield Industries gathered the following information for the month ended June 31:
The static budget volume is 5,500 units:
Overhead flexible budget:

Actual production was 12,000 units.Actual overhead costs were $28,000 for variable costs and $37,000 for fixed costs.Actual machine hours worked were 16,000 hours.
What is the standard variable overhead rate per machine hour?

Quizplus · Accepted Answer

D)$56,000/14,500 = $3.86

Litchfield Industries Gathered the Following Information for the Month Ended