The standard specifications for an electric motor manufactured by XYZ Electric Co. follow: Standard cost per unit:
Question:
Standard cost per unit:
Materials (2 lb à $5 per lb) . . . . . . . . . . . . . . . . . . . . . . . . . $10.00
Labor (4 hr à $12 per hr) . . . . . . . . . . . . . . . . . . . . . . . . . . . 48.00
Factory overhead (4 hr à $3.38* per hr). . . . . . . . . . . . . . . . 13.52
Total standard cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $71.52
*$1.00 variable þ $2.38 fixed ¼ $3.38
Factory overhead rates are based on a normal 70% capacity and use the following flexible budget:
The actual production was 2,500 motors, and factory overhead costs totaled $29,750.
Required:
Calculate the factory overhead variances using the two-variance method and the diagram format.
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Related Book For
Principles of Cost Accounting
ISBN: 978-1305087408
17th edition
Authors: Edward J. Vanderbeck, Maria Mitchell
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