Answer :
Flexible budget estimate at level of 62000 units
Fixed cost = 10000
Variable costs = 62000 * 1 = 62000
Total factory overhead estimates = 62000 + 10000 = 72000
Total variance = 50000 - 80000 = 30000 Unfavorable
Portion relating to activity variance = (Standard Quantity - Actual Quantity) * Standard Rate
Portion relating to activity variance = (40000 - 62000)*1
Portion relating to activity variance = 22000 Unfavorable
Portion relating to activity variance = (Activity Quantity * Budgeted rates) - Actual cost incurred
Portion related to spending variance = (62000*1) - 70000
Portion related to spending variance = 8000 Unfavorable
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