Question

GreatGreat

Fender allocates manufacturing overhead to production based on standard direct labor hours.

GreatGreat

Fender reported the following actual results for

2016​:

actual number of fenders​ produced ,20,000​;

actual variable​ overhead,$5,300​;

actual fixed​ overhead,$27,000​;

actual direct labor​ hours,370.

Read the requirements

.

Requirement 1. Compute the overhead variances for the​ year: variable overhead cost​ variance, variable overhead efficiency​ variance, fixed overhead cost​ variance, and fixed overhead volume variance.

Begin with the variable overhead cost and efficiency variances. Select the required​ formulas, compute the variable overhead cost and efficiency​ variances, and identify whether each variance is favorable​ (F) or unfavorable​ (U). ​(Abbreviations used: AC​ = actual​ cost; AQ​ = actual​ quantity; FOH​ = fixed​ overhead; SC​ = standard​ cost; SQ​ = standard​ quantity; VOH​ = variable​ overhead.)

		Formula		Variance
VOH cost variance	=		=
VOH efficiency variance	=		=

		Formula						Variance
FOH cost variance	=	Actual FOH - Budgeted FOH	=		-		=
FOH volume variance	=	Bugeted FOH - Allocated FOH	=		-		=

Static budget variable overhead	$4,608
Static budget fixed overhead	$23,040
Static budget direct labor hours	576	hours
Static budget number of units	24,000	units
Standard direct labor hours	0.024	hours per fender

Thank you and have a good day

Answer 1