Sams Furniture uses variance analysis to evaluate manufacturing overhead in its factory. The information for the June
Question:
Sam's Furniture uses variance analysis to evaluate manufacturing overhead in its' factory. The information for the June overhead expenditures is as follows:
Budgeted output units 22,000 chairs
Budgeted fixed manufacturing overhead $26,400
Budgeted variable manufacturing overhead $2.50 per direct labour hour
Budgeted direct manufacturing labour hours 0.3 hours per chair
Fixed manufacturing costs incurred $25,300
Direct manufacturing labour hours used 7,600 hours
Variable manufacturing costs incurred $17,100
Actual units manufactured 19,000 chairs
Required:
Calculate the variable manufacturing overhead rate and efficiency variances; and, the fixed manufacturing overhead rate and production-volume variances.
Fundamental accounting principle
ISBN: 978-0078025587
21st edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta