Bottom picture is for a factory overhead cost variance report for the assembly d

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Bottom picture is for a factory overhead cost variance report for the assembly department

Chapter 8 Homework eBook Calculator Factory Overhead Cost Variance Report Feeling Better Medical Inc., a manufacturer of disposable medical supplies, prepared the following factory overhead cost budget for the Assembly Department for October of the cument year. The company expected to operate the department at100% of normal apaaty of 850 hours. Variable costs: Indirect factory wages Power and light Indirect materials $25,800 14,362 Total variable cost $57,964 Fixed costs Supervisory salaries $16,620 42,620 13,000 Depreciation of plant and equipment Insurance and property taxes Total fixed cost 72,240 Total factory overhead cost 130,204 During October, the department operated at 9,100 standard hours, and the factory overhead costs incurred were indirect factory wages, $27.570; power and light, $18,500; indirect material Required: is, $15,500: supervisory salaries, $16,620; depreciation of plant and equipment, $42,620; and insurance and property taxes, $13,000 Prepare a factory overhead cost vanance report for October To be useful for cost control the budgeted amounts nould be based on sutOors Entera favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your par unit computations to the nearest cent, if required. If an amount box does not require an entry, leave it blank Feeling Better Medical Inc. Check My Work Previous

Explanation / Answer

*Excess hours used over normal x Standard rate for fixed factory overhead = (9100 - 8600) x ($72240 / 8600 hours) = 500 x $8.40 = $4200

Feeling Better Medical Inc. Assembly Department Factory Overhead Cost Variance Report For the Month Ended October Budget Actual Favorable Variances Unfavorable Variances Variable costs: Indirect factory wages 27300 27570 270 Power and light 18837 18500 -337 Indirect materials 15197 15500 303 Total variable cost 61334 61570 Fixed costs: Supervisory salaries 16620 16620 Depreciation of plant and equipment 42620 42620 Insurance and property taxes 13000 13000 Total fixed cost 72240 72240 Total factory overhead cost 133574 133810 Total controllable variances -337 573 Net controllable variance-unfavorable 236 Volume variance-favorable Excess hours used over normal at the standard rate for fixed factory overhead* -4200 Total factory overhead cost variance-favorable -3964

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