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  • Variable Overhead Variances Variable Overhead Costs Incurred Variable Overhead Cost Rate

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    Sitwat Un Nisa
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    This document provides information about overhead cost variances for a company. It shows that variable manufacturing overhead costs incurred were $618,840. Fixed manufacturing overhead costs incurred were $145,790, higher than the budgeted amount of $144,000. There were variable overhead and fixed overhead spending variances of $7,640 and $1,790 respectively due to actual costs being above budget. The document also gives details needed to calculate efficiency variances for overhead.

    Original Description:

    Solution of questions from Cost and Management

    Original Title

    HW Q 6

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    This document provides information about overhead cost variances for a company. It shows that variable manufacturing overhead costs incurred were $618,840. Fixed manufacturing overhead costs incurred were $145,790, higher than the budgeted amount of $144,000. There were variable overhead and fixed overhead spending variances of $7,640 and $1,790 respectively due to actual costs being above budget. The document also gives details needed to calculate efficiency variances for overhead.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    3 views4 pages

    Variable Overhead Variances Variable Overhead Costs Incurred Variable Overhead Cost Rate

    Uploaded by

    Sitwat Un Nisa
    This document provides information about overhead cost variances for a company. It shows that variable manufacturing overhead costs incurred were $618,840. Fixed manufacturing overhead costs incurred were $145,790, higher than the budgeted amount of $144,000. There were variable overhead and fixed overhead spending variances of $7,640 and $1,790 respectively due to actual costs being above budget. The document also gives details needed to calculate efficiency variances for overhead.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 4

    Variable manufacturing overhead costs incurred $618,840

    Variable manufacturing overhead cost rate $8 per standard machine-hour


    Fixed manufacturing overhead costs incurred $145,790
    Fixed manufacturing overhead costs budgeted $144,000
    Denominator level in machine-hours (Budgeted) 72,000
    Standard machine-hour allowed per unit of output 1.2
    Units of output 65,500
    Actual machine-hours used 76,400
    Ending work-in-process inventory 0

    QUESTION 1

    Variable Overhead Variances

    Variable overhead costs incurred Variable overhead cost rate


    $618,840 8

    Fixed Overhead Variances

    Fixed overhead costs incurred Flexible Budget


    $145,790 $144,000

    4-Variance Analysis Spending Variance


    Variable OH 7640
    Fixed OH 1790

    QUESTION 2

    Variable Overhead Variances

    Particular Debit
    Variable manufacturing overhead control 618840
    Cash or Account Payablle
    Variable manufacturing overhead control 7640
    Manufacturing Overhead Variance

    Fixed Overhead Variances

    Particular Debit
    Fixed manufacturing overhead control 145790
    Cash or Account Payablle
    Fixed manufacturing overhead control 19390
    Manufacturing Overhead Variance

    QUESTION 3
    Efficiency Variances:
    Inefficient use of machine-hours, such as machine breakdowns, poor scheduling, or inexperienced workers.
    Spending Variances:
    Purchasing raw materials or services at higher than expected prices.
    Production Volume Variances:
    Variances in production volume compared to the budgeted level.
    Flexible Budget Variable Overhead Variance
    $611,200 $7,640

    FOH Spending Variance FOH Efficiency Variance FOH Variance


    $1,790 $17,600 $19,390

    Efficiency Variance
    93600 (76400-65500*1.2)*8
    17600

    Credit

    618840

    7640

    Credit

    145790

    19390
    duling, or inexperienced workers.

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