Question
In: Accounting
Variable OH rate $3.35 Fixed OH rate $1.80 Hours 18,900 17,955* Fixed overhead $46,000 Actual variable...
| Variable OH rate | $3.35 | |
| Fixed OH rate | $1.80 | |
| Hours | 18,900 | 17,955* |
| Fixed overhead | $46,000 | |
| Actual variable overhead | $67,430 | |
| Total factory overhead | $101,450 |
*Actual hours are equal to standard hours for units produced.
The total factory overhead cost variance is
a.$4,866.75 favorable
b.$8,981.75 favorable
c.$4,866.75 unfavorable
d.$8,981.75 unfavorable
Solutions
Expert Solution
Option D.Why D?
Variable Factory Overhead= Actual Variable Factory Overhead – Budgeted Variable Factory Overhead
(A) = $67,430 – (17,955 hours × $3.35) = $7,280.75 Unfavorable Variance Fixed Factory Overhead Volume Variance = (Standard Hours NormalCapacity – SHfor Actual Units Produced) × Fixed Factory Rate
(B) = (18,900 hours – 17,955 hours) × $1.80 = $1,701 Total factory overhead cost variance = Variable factory overhead variance + Fixed factory overhead volume variance
= $7,280.75 + $1,701 = $8,981.75 Unfavorable Variance
ekkarill92 answered 2 years agoRelated Solutions
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Actual material cost (24,500 pounds purchased and used)
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Machine Hours per
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Total Sales Dollars
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Total Contribution
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Unit
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10000
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