# Factory overhead, volume variance, standard costs, profit ce

MA_U10_39-43: please see attachment for problems.

39. The standard factory overhead rate is \$10 per direct labor hour (\$8 for variable factory overhead and \$2 for fixed factory overhead) based on 100% capacity of 30,000 direct labor hours. The standard cost and the actual cost of factory overhead for the production of 5,000 units during May were as follows:
Standard: 25,000 hours at \$10 \$250,000

What is the amount of the factory overhead volume variance?

\$12,500 favorable
\$10,000 unfavorable
\$12,500 unfavorable
\$10,000 favorable

40. The standard factory overhead rate is \$7.50 per machine hour (\$6.20 for variable factory overhead and \$1.30 for fixed factory overhead) based on 100% capacity of 80,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 15,000 units during August were as follows:
Standard hours allowed for units produced: 60,000 hours at \$7.50 450,000

What is the amount of the factory overhead volume variance?
\$12,000 unfavorable
\$12,000 favorable
\$14,000 unfavorable
\$26,000 unfavorable

41. At the end of the fiscal year, variances from standard costs are usually transferred to the ______.
direct labor account
cost of goods sold account
direct materials account

42. In a profit center, the department manager has responsibility for and the authority to make decisions that affect _______.
not only costs and revenues, but also assets invested in the center
the assets invested in the center, but not costs and revenues
both costs and revenues for the department or division
costs and assets invested in the center, but not revenues

43. Division T reported income from operations of \$875,000 and total service department charges of \$575,000. Therefore _______.
net income was \$300,000
the gross profit margin was \$300,000
income from operations before service department charges was \$1,450,000
consolidated net income was \$300,000

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