PLease, PROVIDE FORMULA! THANK YOU! Elite Brands Company uses standard costs for

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PLease, PROVIDE FORMULA! THANK YOU!

Elite Brands Company uses standard costs for its manufacturing division. Standards specify 0.2 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following data:

Production volume

6,300units

Budgeted variable overhead costs

$15,000

Budgeted direct labor hours

640 hours

At the end of the year, actual data were as follows:

Production volume

4,000units

Actual variable overhead costs

$15,200

Actual direct labor hours

505hours

How much is the standard cost per direct labor hour for variable overhead? (Round your answer to the nearest cent.)

A. $29.70per direct labor hour

B.$ 23.44per direct labor hour.

C.$18.75per direct labor hour

D.$23.75per direct labor hour

Production volume

6,300units

Budgeted variable overhead costs

$15,000

Budgeted direct labor hours

640 hours

Explanation / Answer

B.$ 23.44per direct labor hour. Budgeted Variable Overhead Costs              15,000.00 Budgeted Direct Labour Hours                    640.00 Standard Cost for VO per DL hour = 15,000/640                      23.44 Note: Standard and Budgeted Variable cost per unit is always same

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