The peter Corporation , which manufactures computer switches, uses a standard cost system and carries all inventories at standard. The standard manufacturing overhead costs per switch are based on direct labor hours and are shown below:
Variable overhead (5 hours @ $12 per direct manufacturing labor
hour) $ 60
Fixed overhead (5 hours @ $15* per direct manufacturing labor hour)
75
Total overhead per switch
$135
*Based on capacity of 200,000 direct manufacturing labor hours per
month.
The following information is available for the month of
December:
46,000 switches were produced although 40,000 switches were
scheduled to be produced.
225,000 direct manufacturing labor hours were worked at a total
cost of $5,625,000.
Variable manufacturing overhead costs were $2,750,000.
Fixed manufacturing overhead costs were $3,050,000.
Questions to answer:
The variable overhead spending variance for December was?
The variable manufacturing overhead efficiency variance for
December was?
The total variable manufacturing overhead variance was?
The fixed manufacturing overhead spending variance for December
was?
The fixed overhead production-volume variance for December
was?
What amount should be credited to the Allocated Manufacturing
Overhead Control account for the month of December?
Under the 2-variance method, the flexible-budget variance for
December was?
Under the 3-variance method, the spending variance for December
was?
Answer : I have given answer for 4 sub part of Question.
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