At the beginning of the year, Goodman Company had the following standard cost sheet for one of
Fantastic news! We've Found the answer you've been seeking!
Question:
Direct materials: 10 kg @ 3.20 per kg
Direct labour: 4 hours @ $9.00 per hour
Fixed overhead: 4 hours @ $4.00 per hour
Variable overhead: 4 hours @ $0.75 per hour
The company computes its overhead rates using practical volume, which is 72,000 units. The actual results for the year are
Units produced 70,000
Direct labour hours 290,000
Actual wage per hour $9.05
Fixed overhead $1,160,000
Variable overhead $218,000
Required: [Must include detailed calculation including formulas and Indicate if Favourable or Unfavourable]
A. Compute the fixed overhead spending and volume variances.
B. Compute the variable overhead spending and efficiency variances.
Related Book For
Management Accounting
ISBN: 978-0132570848
6th Canadian edition
Authors: Charles T. Horngren, Gary L. Sundem, William O. Stratton, Phillip Beaulieu
Posted Date: