1. Compute the overhead variance\'s for the month: variable overhead cost varian
ID: 2563632 • Letter: 1
Question
1. Compute the overhead variance's for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance.
2. Explain the the variances are favorable or unfavorable.
Question Help The following information relates to Brook, Inc. 's overhead costs for the month Click the icon to view the information. ) EE Requirements 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance and fixed overhead volume variance Explain why the variances are favorable or unfavorable Requirement 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. gin by selecting the formulas needed to compute the variable overhead (VOH) and fixed overhead (FOH) variances, and then compute each variance amount ual overhead -(Actual hours x Standard pri (Actual hours - Standard hours allowed) x Standard price Actual overhead - Budgeted overhead Budgeted overhead- Allocated overhead = VOH cost variance VoH efficiency variance FOH cost variance FOH volume variance number in the edit fields and then cl Che er Check AnswerExplanation / Answer
a) VOH Cost variance = Actual cost - (Std cost per hr X Actual hrs worked)
= 10700 - [ (8000/1600) X (6900*0.25)]
10700 - [ 5 x 1725] = 10700-8625 = 2075 (A)
b) VOH Efficiency variance = (Actual hours - Std hours allowed) X Std price
= [(6900 x 0.25) - (0.4 x 6900)] x (8000/1600) = 5175 (A)
c) FOH Cost variance = Actual OH - Budgeted OH = 2840- [3200/4000] x 6900 = 2680 (F)
d) FOH Volume variance = Budgeted OH - Allocated OH = [1600- (0.25 X 6900)] x 3200/1600 = 250 (F)
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