Total overhead, 3-variance analysis. (5-50 minutes) The OlssonLangkilde Air Force Base has an extensive repair facility for jet engines. It developed standard costing and flexible budgets to account for this activity. Budgeted variable overhead at a level of 8,000 standard monthly direct labour-hours was SKr 64,000; budgeted total overhead at 10,000 standard direct labour-hours was SKr 197,600. The standard cost allocated to repair output included a total overhead rate of 120% of standard direct labour cost.

Total overhead incurred for October was SKr 249,000. Direct labour costs incurred were SKr 202,440. The direct labour price variance was SKr 9,640 U. The direct labour flexible-budget variance was SKr 14,440 U.

The standard labour price was SKr 16 per hour. The production-volume variance was SKr 14,000 E REQUIRED 1. Calculate the direct labour efficiency variance and the spending, efficiency and production-volume variances for overhead. Also, calculate the denominator level.

Describe how individual variable manufacturing overhead items are controlled from day to day. Also, describe how individual fixed manufacturing overhead items are controlled. nki7