Calculating factory overhead}

The standard capacity of a factory is 8,000 units per month. Cost and production data follow:

Transcribed Image Text:

Standard application rate for fixed overhead Standard application rate for variable overhead Production-Month 1 Production-Month 2 Actual factory overhead-Month 1 Actual factory overhead-Month 2 $0.50 per unit $1.50 per unit 7,200 units 8,400 units $14,500 $17,600 Calculate the amount of factory overhead allowed for the actual volume of production each month and the variance between budgeted and actual overhead for each month.