Ollivander manufactures premium Magic Wands. The following are some manufacturing overhead data for Magic Wands for...

 

Transcribed Image Text:

Ollivander manufactures premium Magic Wands. The following are some manufacturing overhead data for Magic Wands for the year ended March 31, 2020. Actual Flexible Allocated Manufacturing Overhead Results Budget Amount Variable $60,560 $76,800 $76,800 Fixed $350,210 $348,096 $375,897 Budgeted number of wands (output): 892 Planned allocation rate: 3 machine-hours per wand Actual number of machine-hours used: 1,445 hours Static-budget variable manufacturing overhead costs: $71,120 Ollivander looks at this information and needs some help with interpretation. When comparing actual results to the flexible budget it looks like he performed well on variable overhead but poorly on fixed overhead; yet, comparing to the allocated amount tells a different story. Ollivander needs your help interpreting these variances! Can you help Ollivander? Ollivander manufactures premium Magic Wands. The following are some manufacturing overhead data for Magic Wands for the year ended March 31, 2020. Actual Flexible Allocated Manufacturing Overhead Results Budget Amount Variable $60,560 $76,800 $76,800 Fixed $350,210 $348,096 $375,897 Budgeted number of wands (output): 892 Planned allocation rate: 3 machine-hours per wand Actual number of machine-hours used: 1,445 hours Static-budget variable manufacturing overhead costs: $71,120 Ollivander looks at this information and needs some help with interpretation. When comparing actual results to the flexible budget it looks like he performed well on variable overhead but poorly on fixed overhead; yet, comparing to the allocated amount tells a different story. Ollivander needs your help interpreting these variances! Can you help Ollivander?

Answer rating: 100% (QA)

Variable Manufacturing OH Flexible Budget ACTUAL COST Allocated Total Actual cost 60560 Total 7... View the full answer