Solved

The Following Information Relates to the Month of April for the Trolley

Question 124

Essay

The following information relates to the month of April for The Trolley Manufacturing Company, which uses a standard cost accounting system.
Actual direct labor hours used 7,000 Standard hours allowed for good output 7,500Fixed overhead spending variance - unfavorable $300 Actual total overhead $16,000Budgeted fixed costs $4,500 Normal activity in hours 6,000 Total overhead application rate per DLH$2025\begin{array}{lrr} \text {Actual direct labor hours used } &7,000\\ \text { Standard hours allowed for good output } &7,500\\ \text {Fixed overhead spending variance - unfavorable } &\$300\\ \text { Actual total overhead } &\$16,000\\ \text {Budgeted fixed costs } &\$4,500\\ \text { Normal activity in hours } &6,000\\ \text { Total overhead application rate per DLH}&\$2025\end{array}

Required:
(Be sure to indicate whether the variances are favorable or unfavorable.)
a. What is the variable overhead efficiency variance?
b. What is the variable overhead price variance?
c. What is the fixed production volume variance?

Correct Answer:

verifed

Verified

Fixed overhead rate: $4,500/6,000 = $0.7...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents