Robert Company, which applies overhead to production on the basis of machine hours, reported the following...

Robert Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended:

Actual units produced: 12,000

Actual variable overhead incurred: $77,700

Actual machine hours worked: 18,800

Standard variable overhead cost per machine hour: $4.50

Robert estimates that it takes 1.5 hours manufacture a completed unit.

Compute all standards and variances

Solutions

Expert Solution

Answer:-Variable overhead efficiency variance=(Standard hours–Actual working hours)*Standard Rate

= ($18000 hours - $18800 hours)*$4.50 per hour

= $3600 Unfavourable

Variable overhead rate variance = (Standard rate –Actual rate)*Actual working hour

=($4.50 per hour – ($77700/18800 hours) per hour)*18800 hours

=$6900 Favourable

Standard hours =12000 units*1.5 hours

=18000 hours

Variable overhead cost variance= Variable overhead rate variance+ Variable overhead efficiency variance

=$6900 F+$3600 U

=$3300 Favourable

ekkarill92 answered 11 months ago

Next > < Previous

Related Solutions

Barnes Company applies overhead on the basis of machine hours. Given the...

Question 14 Barnes Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period: Estimated annual overhead cost $3,000,000 Actual annual overhead cost $2,970,000 Estimated machine hours 300,000Actual machine hours 295,000 1) $2,950,000 applied and $20,000 overapplied 2) $3,000,000 applied and $20,000 overapplied 3) $2,950,000 applied and $20,000 underapplied 4) $2.970,000 applied and neither under- nor overappliedQuestion 21 Activity-based costing uses 1) one plantwide pool and a single cost driver. 2)...

The company applies overhead cost to jobs on the basis of machine-hours worked. For the current...

The company applies overhead cost to jobs on the basis of machine-hours worked. For the current year, the company estimated that it would work 75,000 machine-hours and incur $450,000 in manufacturing overhead cost. The following transactions were recorded for the year: a. Raw materials were purchased on account, $ 410,000 b. Raw materials were requisitioned for use in production, $ 380,000 ($360,000 direct materials and $20,000 indirect materials). c. The following costs were incurred for employees services: direct labor, $...

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs...

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $300,000 for the year, and machine usage is estimated at 125,000 hours. For the year, $322,000 of overhead costs are incurred and 130,000 hours are used. Collapse question part (a) Compute the manufacturing overhead rate for the year. (Round answer to 2 decimal places, e.g. 1.25.) Manufacturing overhead rate $ per machine hour

Ikea Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs...

Ikea Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $456,789 4 for the year, and machine usage is estimated at 126,000 hours For the year, $432450 of overhead costs are incurred and 125,500 hours are used. What is the predetermined overhead rate What is the amount of overhead applied Has it been over or underapplied? Prepare the adjusting entry to adjust the cost of goods sold

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs...

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are estimated to total $283,725 for the year, and machine usage is estimated at 126,100 hours. For the year, $303,850 of overhead costs are incurred and 130,200 hours are used. Compute the manufacturing overhead rate for the year. (Round answer to 2 decimal places, e.g. 1.25.) Manufacturing overhead rate $ per machine hour What is the amount of under- or overapplied overhead at December...

Mosaic Company applies overhead using machine hours and reports the following information. Actual machine hours used...

Mosaic Company applies overhead using machine hours and reports the following information. Actual machine hours used (AH) 4,900 hours Standard machine hours (for actual production) (SH) 5,400 hours Actual variable overhead rate per hour (AVR) $ 4.55 Standard variable overhead rate per hour (SVR) $ 4.40 QS 23-18A Total variable overhead cost variance LO P5 Compute the total variable overhead cost variance and classify it as favorable, unfavorable or no variance. Compute the variable overhead spending variance and the variable...

The Littlefield Company applies manufacturing overhead costs to products on the basis of direct labor-hours. The...

The Littlefield Company applies manufacturing overhead costs to products on the basis of direct labor-hours. The standard cost card shows that 12 direct labor-hours are required per unit of product. For August, the company budgeted to work 360,000 direct labor-hours and to incur the following total manufacturing overhead costs: Total fixed overhead costs $475,200 Total variable overhead costs $396,000 During August, the company completed 28,000 units of product, worked 344,000 direct labor-hours, and incurred the following total manufacturing overhead costs:...

If overhead is applied on the basis of machine hours, what will be the overhead rate per hour?

Simplex Company has the following estimated costs for next year: Simplex estimates that 10,000 direct labour and 16,000 machine hours will be worked during the year. If overhead is applied on the basis of machine hours, what will be the overhead rate per hour?

Martinez Corporation applies overhead based upon machine-hours. Budgeted factory overhead was $362,000 and budgeted machine-hours were...

Martinez Corporation applies overhead based upon machine-hours. Budgeted factory overhead was $362,000 and budgeted machine-hours were 24,000. Actual factory overhead was $393,000 and actual machine-hours were 27,000. Before disposition of under/overapplied overhead, the cost of goods sold was $610,000 and ending inventories were as follows: Direct materials $ 80,000 WIP 200,000 Finished goods 270,000 Total $550,000 Required: a. Determine the budgeted factory overhead rate per machine-hour. b. Compute the over/underapplied overhead. c. Prepare the journal entry to dispose of the variance using the write-off to cost of...

Schulz Corporation applies overhead based upon machine-hours. Budgeted factory overhead was $266,400 and budgeted machine-hours were...

Schulz Corporation applies overhead based upon machine-hours. Budgeted factory overhead was $266,400 and budgeted machine-hours were 18,500. Actual factory overhead was $287,920 and actual machine-hours were 19,050. Before disposition of under/overapplied overhead, the cost of goods sold was $560,000 and ending inventories were as follows: Direct Materials: $60,000 WIP: 190,000 Finished Goods: 250,000 Total: $500,000 1) Determine the budgeted factor overhead rate per machine-hour. 2) Compute the over/underapplied overhead. 3) Select the journal entry to dispose of the variance using...

Subjects