Cintron Company produces high-quality leather belts. The Boise plant uses a stan

Question

Cintron Company produces high-quality leather belts. The Boise plant uses a standard costing system with the following standards and actuals.

Direct labor is the basis for applying variable and fixed overhead.

What is practical capacity stated at standard labor hours?

Standard Price Standard Usage Direct Labor (DL) $ 13 0.92 hours Variable Overhead (per DL hour) $ 5 Budgeted Production for July 35,176 Budgeted Fixed Overhead for July $ 167,621 July Data Number of Belts Produced 32,078 Number of Labor Hours Used 28,622 Actual Variable Overhead Costs    $ 199,785 Actual Fixed Overhead Costs $ 127,159

Explanation / Answer

Practical capacity stated at standard labor hours = Budgeted Production for July * Standard labour hours required per unit Practical capacity stated at standard labor hours = 35176 units * 0.92 hours = 32361.92 i.e.32362 direct labour hours

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.