# Morgan Manufacturing makes a product with the following standard costs: Standard Quantity or Hours Standard Price...

###### Question:

Morgan Manufacturing makes a product with the following standard costs:

 Standard Quantity or Hours Standard Price or Rate Standard Cost per Unit Direct materials 6.5 kilos $1.00 per kilo$6.50 Direct labor 0.3 hours $10.00 per hour$3.00 Variable overhead 0.3 hours $4.00 per hour$1.20

In January the company's budgeted production was 7,400 units but the actual production was 7,200 units. The company used 45,580 kilos of the direct material and 2,400 direct labor-hours to produce this output. During the month, the company purchased 48,500 kilos of the direct material at a cost of $53,350. The actual direct labor cost was$18,473 and the actual variable overhead cost was $7,714. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The variable overhead efficiency variance for January is: Select one: a.$960.00

b. $3,840.00 c.$27,360.00

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