Question: Johnston Equipment develops food processing equipment. The budgeted fixed overhead costs for 2018 total $768,000. The company uses direct labour-hours for fixed overhead allocation and

Johnston Equipment develops food processing equipment. The budgeted fixed overhead costs for 2018 total $768,000. The company uses direct labour-hours for fixed overhead allocation and anticipates 480,000 hours during the year for 960,000 units. An equal number of units are budgeted for each month.

During April 84,000 packages (units) were produced and $66,000 was spent on fixed overhead.

Required:

a. Determine the fixed overhead rate for 2018 based on direct labour-hours.

b. Determine the fixed overhead static-budget variance for April.

c. Determine the production-volume overhead variance for April.

Step by Step Solution

★★★★★

3.43 Rating (150 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Solution A Fixed Overhead rate for 2018 Formulae Budgeted Fixed overhead cost Direc... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

A special roulette wheel, which has an equal number of red and black spots, has come up red four times in a row. Assuming that the roulette wheel is fair, what concept allows a player to know that...

A standard deck of 52 playing cards has an equal number of hearts, spades, clubs and diamonds. A deck is shuffled and a card is randomly selected. Let X be the number of cards selected, up to and...

An equal number of two-parent families, each with three children younger than ten years old were interviewed in cities of populations ranging from 25,000 to 75,000. Interviewers collected data on...

Connor Companys budgeted prices for direct materials, direct manufacturing labor, and direct marketing (distribution) labor per attach case are $ 40, $ 8, and $ 12, respectively. The president is...

Natures Own Garden manufactures organic fruit preserves sold primarily through health food stores and on the Web. The company closes for two weeks each December to enable employees to spend time with...

The new president of the Wernecke Company was stumped. Why had profits gone down? He had directed the sales department to push the product with the highest contribution margin , and the sales...

Panache Clothiers is a small company that manufactures tall-men??s suits. The company has used a standard cost accounting system. In May 2012, 11,200 suits were produced. The following standard and...

Refer to Exercise 11-34. Assume that the actual fixed overhead was $420,000. Budgeted fixed overhead was $405,000, based on practical capacity of 33,750 direct labor hours. Required: 1. Calculate the...

Vasquez Manufacturing Company uses a standard cost accounting system to account for the manufacture of exhaust fans. In July 2012, it accumulates the following data relative to 1,800 units started...

Beck Company set the following standard unit costs for its single product. Direct materials (26 Ibs. @ $4 per Ib.) . . . . . . . . . . . . . . . . $104.00 Direct labor (8 hrs. @ $8 per hr.) . . . . ....

Double Integration Method (Beams) For continuous beam ABC. Supports are hinge. a) Find the degree of Indeterminacy b) Using Double Integration Method, find deflection at mid spans & Slope at...

4) Major Foods, Inc. produces a cereal from oat grain. The company buys unprocessed oats for $400 per ton. It costs $60 per ton to send the oats through a processor, which produces 1,900 kilograms of...

In which scenario would a taxpayer most likely benefit from using the instllment sale method? A taxpayer sold: A bussines use car. The sales price is more than the taxpayer's basis after deductions...

what are three detailed examples of critical listening?

what are three detailed examples of empathetic listening?

The management of Devine Instrument Company is considering the purchase of a new drilling machine, model RoboDril 1010K. According to the specifications and testing results, RoboDril will...

Savrup has drawn a graph to illustrate the linear relation between the cost of attending movies and the number of movies a person attends at Cineplex. Cineplex charges a membership fee of $25. It...

Lilly County, faced with the prospect of declining revenues, decides it can save money by doing all printing in-house. The county creates the Lilly Printing Fund (an Internal Service Fund), directs...

downsize The hypothalamus and pituitary gland are essential in regulating the production of growth hormones. Specifically, they produce hormones such as somatostatin and growth hormone-releasing...

Johnston Equipment develops food processing equipment. The budgeted fixed overhead costs for 2018 total $624,000. The company uses direct labour-hours for fixed overhead allocation and anticipates...

Johnston Equipment develops food processing equipment. The budgeted fixed overhead costs for 2018 total $768,000. The company uses direct labour-hours for fixed overhead allocation and anticipates...

Johnston Equipment develops food processing equipment. The budgeted fixed overhead costs for 2018 total $624,000. The company uses direct labour-hours for fixed overhead allocation and anticipates...

Johnston Equipment Ltd develops food processing equipment. The budgeted fixed overhead costs for 2020 total $768,000. The company uses direct labour-hours for fixed overhead allocation and...