Refer to the information for Rostand Inc. above. Assume that the actual fixed overhead was $ 403,400.
Question:
Rostand Inc. operates a delivery service for over 70 restaurants. The corporation has a fleet of vehicles and has invested in a sophisticated, computerized communications system to coordinate its deliveries. Rostand has gathered the following actual data on last year’s delivery operations:
Deliveries made ..........38,600
Direct labor .............31,000 direct labor hours @ $ 9.00
Actual variable overhead ........$ 157,700
Rostand employs a standard costing system.
During the year, a variable overhead rate of $ 5.10 per hour was used. The labor standard requires 0.80 hour per delivery.
Required:
1. Calculate the standard fixed overhead rate based on budgeted fixed overhead and practical capacity.
2. Compute the fixed overhead spending and volume variances. Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Cornerstones of Financial and Managerial Accounting
ISBN: 978-1111879044
2nd edition
Authors: Rich, Jeff Jones, Dan Heitger, Maryanne Mowen, Don Hansen
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