Taylor Inc. uses a standard cost system. The company has the following results for the current period:

Question:

Variable overhead is applied at $27.50 per direct labour-hour. Actual variable overhead was $310,600.

Required:

1. Compute the fixed overhead budget variance.

2. ?Because the actual overhead and the budgeted overhead are the same the volume variance is 0.? True or false? Show calculations.

3. Compute the total variable overhead variance and its component variances.

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Related Book For answer-question

Introduction to Managerial Accounting

ISBN: 978-1259105708

5th Canadian edition

Authors: Peter C. Brewer, Ray H. Garrison, Eric Noreen, Suresh Kalagnanam, Ganesh Vaidyanathan

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Question Posted: Oct 25, 2019 12:02 PM

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Taylor Inc. uses a standard cost system. The company has the following results for the current period:

Question:

Budget Actual $ 160,000 $ 160,000 Fixed overhead 6,500 units 6,000 units Units Direct labour-hours (DLH) 13,333 hours 12,500 hours Standard quantity of DLH per unit 2.0152 hours

Step by Step Answer:

1 Fixed overhead variances 2 False The overhead volume arises from the difference between the activi...View the full answer

Introduction to Managerial Accounting

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