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Elite Brands Company uses standard costs for its manufacturing division. Standar

ID: 2464351 • Letter: E

Question

Elite Brands Company uses standard costs for its manufacturing division. Standards specify 0.1 direct labor hours per unit of product. At the beginning of the year, the static budget for variable overhead costs included the following dutu Production volume Budgeted variable overhead costs Budgeted direct labor hours 6,500 units $15,000 600 hours At the end of the year, actual data were as follows: Production volume Actual variable overhead costs Actual direct labor hours 4,100 units $15,100 495 hours ( A. $36.59 per direct labor hour ( B. $25.00 per direct labor hour C. $30.30 per direct labor hour O D. $25.17 per direct labor hour

Explanation / Answer

standard cost per direct labor hour for variable overhead=$15,000/600 hours=$25.00 per hour

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