Question

Gonzo Gasket Co. budgets 8,000 direct labor hours for the year. The total overhead budget is expected to amount to $20,000. The standard cost for a unit of the company's product estimates the variable overhead as follows:
Variable factory overhead (3 hours @ $2 per direct labor hour) . . . . $6 per unit
The actual data for the period follow:
Actual completed units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,500
Actual direct labor hours . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,640
Actual variable overhead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $16,100
Actual fixed overhead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,920
Using the four-variance method, calculate the overhead variances.



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  • CreatedMay 05, 2014
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