In October, Carla Vista Company reports 20,600 actual direct labor hours, and it incurs $213,300 of...

 

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In October, Carla Vista Company reports 20,600 actual direct labor hours, and it incurs $213,300 of manufacturing overhead costs. Standard hours allowed for the work done is 23,700 hours. The predetermined overhead rate is $9.25 per direct labor hour. In addition, the flexible manufacturing overhead budget shows that budgeted costs are $7.08 variable per direct labor hour and $54,250 fixed. Compute the overhead volume variance. Normal capacity was 25,000 direct labor hours. In October, Carla Vista Company reports 20,600 actual direct labor hours, and it incurs $213,300 of manufacturing overhead costs. Standard hours allowed for the work done is 23,700 hours. The predetermined overhead rate is $9.25 per direct labor hour. In addition, the flexible manufacturing overhead budget shows that budgeted costs are $7.08 variable per direct labor hour and $54,250 fixed. Compute the overhead volume variance. Normal capacity was 25,000 direct labor hours.

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The overhead volume variance can be calculated using the formula Overhead Volume Variance Actua... View the full answer