Question: 1. Peter makes custom motorcycles. For the month, Peter makes 10 motorcycles, and each motorcycle takes 200 labor hours. The budgeted variable overhead cost rate

1. Peter makes custom motorcycles. For the month, Peter makes 10 motorcycles, and each motorcycle takes 200 labor hours. The budgeted variable overhead cost rate is $5 per labor hour. What is the budgeted variable overhead cost rate per motorcycle?

2. What are the steps in developing a budgeted variable overhead rate?

3. What are the steps in developing a budgeted fixed overhead rate?

4. What can the flexible-budget variance for variable overhead costs be broken into?

5. What can the flexible-budget variance for fixed overhead costs be broken into?

6. What is the production-volume variance?

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