Franklin Glass Works uses a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours. Each unit requires two standard hours of direct labor for completion. The denominator activity for the year was based on budgeted production of 200,000 units. Total overhead was budgeted at $900,000 for the year, and the fixed manufacturing overhead rate was $1.50 per direct labor-hour. The actual data pertaining to the manufacturing overhead for the year are presented below:
-The standard hours allowed for actual production for the year total:
A)247,500
B)396,000
C)400,000
D)495,000

Question

Franklin Glass Works uses a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours. Each unit requires two standard hours of direct labor for completion. The denominator activity for the year was based on budgeted production of 200,000 units. Total overhead was budgeted at $900,000 for the year, and the fixed manufacturing overhead rate was $1.50 per direct labor-hour. The actual data pertaining to the manufacturing overhead for the year are presented below: 
-The standard hours allowed for actual production for the year total:
A)247,500 
B)396,000 
C)400,000 
D)495,000

Quizplus · Accepted Answer

Standard hours allowed = Standard hours F1F1F1S1F1F1F10 Actual production
= 2 hours per unit F1F1F1S1F1F1F10 198,000 units = 396,000 hours

Franklin Glass Works Uses a Standard Cost System in Which