Klinkhammer Corporation estimated overhead for the year as follows: fixed = $720,000; variable = $4 per...

 

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Klinkhammer Corporation estimated overhead for the year as follows: fixed = $720,000; variable = $4 per unit. Klinkhammer expected to produce 72,000 units for the year. Required: a. Compute the per unit rate that will be used to apply overhead costs to products. b. During the year, Klinkhammer incurred actual overhead costs of $1,104,000 and produced 74,400 units. Compute the overhead applied to units produced. c-1. Compute the amount of under- or overapplied overhead. c-2. Compute the amount of the spending and volume variances. d. What caused applied overhead to be different from budgeted overhead? Req A Req B Req C1 Req C2 Req D Compute the per unit rate that will be used to apply overhead costs to products. Fixed overhead rate Total overhead application rate per unit per unit < Req A Req B > Req A Req B Req C1 Req C2 Req D During the year, Klinkhammer incurred actual overhead costs of $1,104,000 and produced 74,400 units. Compute the overhead applied to units produced. Overhead applied < Req A Req C1 > Req A Req B Req C1 Req C2 Req D Compute the amount of under- or overapplied overhead. Underapplied overhead < Req B Req C2 > Req A Req B Req C1 Req C2 Req D Compute the amount of the spending and volume variances. Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance). Spending variance Volume variance Unfavorable Favorable < Req C1 Req D > Req A Req B Req C1 Req C2 Req D What caused applied overhead to be different from budgeted overhead? What caused the difference? Fixed overhead applied to production exceeded the amount budgeted because actual output exceeded expected output by 2,400 units. Fixed overhead applied to production exceeded the amount budgeted because actual output exceeded expected output by 2,400 units. Fixed overhead applied to production is less than the amount budgeted because actual output is less than the expected output by 2,400 units. Klinkhammer Corporation estimated overhead for the year as follows: fixed = $720,000; variable = $4 per unit. Klinkhammer expected to produce 72,000 units for the year. Required: a. Compute the per unit rate that will be used to apply overhead costs to products. b. During the year, Klinkhammer incurred actual overhead costs of $1,104,000 and produced 74,400 units. Compute the overhead applied to units produced. c-1. Compute the amount of under- or overapplied overhead. c-2. Compute the amount of the spending and volume variances. d. What caused applied overhead to be different from budgeted overhead? Req A Req B Req C1 Req C2 Req D Compute the per unit rate that will be used to apply overhead costs to products. Fixed overhead rate Total overhead application rate per unit per unit < Req A Req B > Req A Req B Req C1 Req C2 Req D During the year, Klinkhammer incurred actual overhead costs of $1,104,000 and produced 74,400 units. Compute the overhead applied to units produced. Overhead applied < Req A Req C1 > Req A Req B Req C1 Req C2 Req D Compute the amount of under- or overapplied overhead. Underapplied overhead < Req B Req C2 > Req A Req B Req C1 Req C2 Req D Compute the amount of the spending and volume variances. Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance). Spending variance Volume variance Unfavorable Favorable < Req C1 Req D > Req A Req B Req C1 Req C2 Req D What caused applied overhead to be different from budgeted overhead? What caused the difference? Fixed overhead applied to production exceeded the amount budgeted because actual output exceeded expected output by 2,400 units. Fixed overhead applied to production exceeded the amount budgeted because actual output exceeded expected output by 2,400 units. Fixed overhead applied to production is less than the amount budgeted because actual output is less than the expected output by 2,400 units.