Litchfield Industries gathered the following information for the month ended June 31: The static budget volume is 5000 units:
Overhead flexible budget:
Actual production was 14,000 units. Actual overhead costs were $27,000 for variable costs and $38,000 for fixed costs. Actual machine hours worked were 17,000 hours.
What is the standard variable overhead rate per machine hour?
A)$2.16
B)$3.30
C)$1.39
D)$3.00

Question

Litchfield Industries gathered the following information for the month ended June 31: The static budget volume is 5000 units:
Overhead flexible budget:
 Actual production was 14,000 units. Actual overhead costs were $27,000 for variable costs and $38,000 for fixed costs. Actual machine hours worked were 17,000 hours.
What is the standard variable overhead rate per machine hour?
A)$2.16 
B)$3.30 
C)$1.39 
D)$3.00

Quizplus · Accepted Answer

The Answer of Litchfield Industries gathered the following information for the month ended June 31: The static budget volume is 5000 units:
Overhead flexible budget:
 Actual production was 14,000 units. Actual overhead costs were $27,000 for variable costs and $38,000 for fixed costs. Actual machine hours worked were 17,000 hours.
What is the standard variable overhead rate per machine hour?
A)$2.16 
B)$3.30 
C)$1.39 
D)$3.00

Litchfield Industries Gathered the Following Information for the Month Ended