Kegler Company has set the following standard costs per unit for the product it manufactures The predetermined

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Kegler Company has set the following standard costs per unit for the product it manufactures

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The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 10,000 units per month. The following flexible budget information is available.

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During May, the company operated at 90% of capacity and produced 9,000 units, incurring the following actual costs.

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Required 1. Compute the direct materials variance, including its price and quantity variances.
2. Compute the direct labor variance, including its rate and efficiency variances, 3. Compute these variances:

(a) variable overhead spending and efficiency,

(b) fixed overhead spending and volume, and

(c) total overhead controllable.
4. Prepare a detailed overhead variance report (as in Exhibit 23.15) that shows the variances for indi¬ vidual items of overhead.

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Fundamental Accounting Principles Volume 2

ISBN: 9780077716660

21st Edition

Authors: John Wild, Ken Shaw, Barbara Chiappetta

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