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Question - Rumington Popcorn uses a standard cost system and applies overhead on a per unit basis. The company estimated that 30,000 units would be produced in 2020 and uses this quantity to establish its standard overhead cost per unit. The cost formula for overhead costs used to develop the standard overhead cost per unit was: Overhead = $120,000 + $6 per unit. During the year, actual overhead cost was $340,000. Actual units produced were 33,000. How much is the overhead volume variance for 2020?
To implement target costing for a new product, companies often set up a cross-functional team with members from engineering, marketing, and costing accounting. Why is a cross-functional team desirable when implementing the target costing approach..
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