The managerial accountant at Aquatics Pools and Spas assess a fixed overhead budget variance of $3700 U in the month of April. The standard hours in April were 2800 hours and the standard rate was projected at $10 per machine-hour. There were unforeseen complications that involved raw materials and the standard rate projected per machine-hour was inaccurate. What was the standard rate per machine-hour if the standard fixed overhead cost of production is $43,700? What is the budgeted fixed overhead amount if the actual fixed overhead is $44,900?
A)$15.61/machine hour; $41,200
B)$14.71/machine hour; $47,400
C)$16.04/machine hour; $48,600
D)$11.81/machine hour; $42,100

Question

Quizplus · Accepted Answer

$43,700 is the standard fixed overhead cost of production. To find the standard rate per machine-hour, divide this amount by the standard hours (2800 hours): $43,700 / 2800 hours = $15.61/machine-hour. The budgeted fixed overhead amount is the actual fixed overhead minus the variance: $44,900 (actual) - $3,700 (unfavorable variance) = $41,200.

The Managerial Accountant at Aquatics Pools and Spas Assess a Fixed