Question

For 2013, Riguilio Inc. set predetermined variable and fixed overhead rates, respectively, at $ 6.50 and $ 9.35 based on an expected monthly capacity of 4,000 machine hours. Each unit of product requires 1.25 machine hours. During August 2013, the company produced 3,360 units and incurred $ 27,000 of variable overhead costs and $ 41,400 of fixed overhead costs. The firm used 4,100 machine hours during August 2013.
a. Using separate overhead rates, calculate overhead variances using the four-variance approach.
b. Using a combined overhead rate, calculate variances using the three-variance approach.
c. Using a combined overhead rate, calculate variances using the two-variance approach.
d. Using a combined overhead rate, calculate variances using the one-variance approach.



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  • CreatedJune 03, 2014
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