Question

Rondell Company uses a standard cost system. Indirect costs were budgeted at $190,800 plus $13 per...

Rondell Company uses a standard cost system. Indirect costs were budgeted at $190,800 plus $13 per direct labour hour. The overhead rate is based on 10,600 hours. Actual results were:
Standard direct labour hours allowed 9,070
Actual direct labour hours 10,600
Fixed overhead $179,000
Variable overhead $174,400
Calculate the fixed overhead production volume variance.
Fixed overhead production volume variance $

Neither favourable nor unfavourableUnfavourableFavourable
Calculate the variable overhead spending variance.
Variable overhead spending variance $

Neither favourable nor unfavourableUnfavourableFavourable
Calculate the variable overhead efficiency variance.
Variable overhead efficiency variance $

Neither favourable nor unfavourableFavourableUnfavourable
Calculate the over- or underapplied overhead.
Overhead $

over-appliedunder-applied
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

1. Fixed overhead rate = 190800/10600 = $18

Fixed overhead volume variance = Applied Fixed overhead - Budgeted fixed overhead

= ($18*9070) - 190800

= $27540 F

2. Variable overhead Spending Variance = Actual variable overhead - (Actual hours * standard rate)

= $174400 - (10600*13)

= $36,600 U

3. Variable overhead Efficiency Variance = Standard rate*(Actual hours - standard hours allowed)

= $13 * (10600-9070)

= $19890 U

4.

Particulars Amount ($)
Actual overhead (179000+174400) 353400
Applied overhead (10600*13)+(18*9070) 301060
Overhead Under applied 52340
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Pointe Claire Company applies overhead based on direct labour hours. Two direct labour hours are required...
Pointe Claire Company applies overhead based on direct labour hours. Two direct labour hours are required for each unit of product. Planned production for the period was set at 8,300 units. Manufacturing overhead is budgeted at $124,500 for the period (20% of this cost is fixed). The 16,290 hours worked during the period resulted in the production of 8,000 units. The variable manufacturing overhead cost incurred was $100,800 and the fixed manufacturing overhead cost was $28,400. Calculate the variable overhead...
Jay Levitt Company budgeted the following cost standards for the current year: Direct materials (2 kg...
Jay Levitt Company budgeted the following cost standards for the current year: Direct materials (2 kg of plastic at $5 per kilogram) $10.00 Direct labour (2 hours at $12 per hour) 24.00 Variable manufacturing overhead 11.45 Fixed manufacturing overhead 7.05 Total standard cost per unit $52.50 Actual costs for producing 2,710 units were as follows: Direct materials used 5,990 kg Direct materials purchased (6,440 kg) $30,912 Direct labour (6,820 hours) $68,882 Variable manufacturing costs $32,300 Fixed manufacturing costs $17,600 Calculate...
Hamilton Pty Ltd uses a standard costing system for product costing. The company uses direct labour...
Hamilton Pty Ltd uses a standard costing system for product costing. The company uses direct labour hours as the cost driver to apply overhead costs. The following amounts were budgeted for the year: Planned production—units 50 000 Direct labour hours 200 000 Variable overhead $ 1 000 000 Fixed overhead $ 600 000 The following were the actual results Actual production—units 48 000 Direct labour hours 195 000 Variable overhead $ 950 000 Fixed overhead $ 610 000 Calculate the...
The Clark Company makes a single product and uses standard costing. Some data concerning this product...
The Clark Company makes a single product and uses standard costing. Some data concerning this product for the month of May follow: Labour rate variance $7,000 favourable Labour efficiency variance $12,000 favourable Variable overhead efficiency variance $4,000 favourable Number of units produced 10,000 Standard labour rate per direct labour hour $12 Standard variable overhead rate per direct labour hour $4 Actual labour hours used 14,000 Actual variable manufacturing overhead costs $58,290 1) What was the variable overhead spending variance for...
Pointe Claire Company applies overhead based on direct labour hours. Two direct labour hours are required...
Pointe Claire Company applies overhead based on direct labour hours. Two direct labour hours are required for each unit of product. Planned production for the period was set at 8,600 units. Manufacturing overhead is budgeted at $120,400 for the period (20% of this cost is fixed). The 16,730 hours worked during the period resulted in the production of 8,190 units. The variable manufacturing overhead cost incurred was $98,300 and the fixed manufacturing overhead cost was $28,100. 1.Calculate the variable overhead...
FIXED OVERHEAD SPENDING AND VOLUME ARIANCES, COLUMNAR AND FORMULA APPROACHES A company provided the following information:...
FIXED OVERHEAD SPENDING AND VOLUME ARIANCES, COLUMNAR AND FORMULA APPROACHES A company provided the following information: Standard fixed overhead rate (SFOR) per direct labour hour    $7.00 Actual fixed overhead rate (AFOR) per direct labour hour        $6.95 Actual direct labour hours worked (AH)                                      36,100 Actual production in units                                                              12,000 Standard hours allowed for actual units produced (SH)          36,000 Required: Using the columnar approach, calculate the fixed overhead spending and efficiency variances. Using the formula approach, calculate the fixed overhead spending variance. Using the formula approach, calculate...
Edney Company employs a standard cost system for product costing. The per-unit standard cost of its...
Edney Company employs a standard cost system for product costing. The per-unit standard cost of its product is Raw materials $ 14.50 Direct labor (2 direct labor hours × $8.00 per hour) 16.00 Manufacturing overhead (2 direct labor hours × $11.00 per hour) 22.00 Total standard cost per unit $ 52.50 The manufacturing overhead rate is based on a normal capacity level of 600,000 direct labor hours. (Normal capacity is defined as the level of capacity needed to satisfy average...
Patel and Sons, Inc., uses a standard cost system to apply overhead costs to units produced....
Patel and Sons, Inc., uses a standard cost system to apply overhead costs to units produced. Practical capacity for the plant is defined as 55,800 machine hours per year, which represents 27,900 units of output. Annual budgeted fixed overhead costs are $279,000 and the budgeted variable overhead cost rate is $3.90 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 21,700 units, which...
Overhead Variances, Four-Variance Analysis Oerstman, Inc., uses a standard costing system and develops its overhead rates...
Overhead Variances, Four-Variance Analysis Oerstman, Inc., uses a standard costing system and develops its overhead rates from the current annual budget. The budget is based on an expected annual output of 125,000 units requiring 500,000 direct labor hours. (Practical capacity is 520,000 hours.) Annual budgeted overhead costs total $830,000, of which $585,000 is fixed overhead. A total of 119,100 units using 498,000 direct labor hours were produced during the year. Actual variable overhead costs for the year were $261,100, and...
Overhead Variances, Four-Variance Analysis, Journal Entries Laughlin, Inc., uses a standard costing system. The predetermined overhead...
Overhead Variances, Four-Variance Analysis, Journal Entries Laughlin, Inc., uses a standard costing system. The predetermined overhead rates are calculated using practical capacity. Practical capacity for a year is defined as 1,000,000 units requiring 200,000 standard direct labor hours. Budgeted overhead for the year is $750,000, of which $300,000 is fixed overhead. During the year, 900,000 units were produced using 190,000 direct labor hours. Actual annual overhead costs totaled $800,000, of which $294,700 is fixed overhead. Required: 1. Calculate the fixed...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT