Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

11.- Fixed Overhead Variances Rostand Inc. operates a delivery service for over 70 restaurants. The corporation has a fleet of vehicles and has invested in

11.-

Fixed Overhead Variances

Rostand Inc. operates a delivery service for over 70 restaurants. The corporation has a fleet of vehicles and has invested in a sophisticated, computerized communications system to coordinate its deliveries. Rostand has gathered the following actual data on last years delivery operations:

Deliveries made 38,600
Direct labor 31,000 direct labor hours @ $14.00
Actual variable overhead $157,700

Rostand employs a standard costing system. During the year, a variable overhead rate of $5.10 per hour was used. The labor standard requires 0.80 hour per delivery.

Assume that the actual fixed overhead was $403,400. Budgeted fixed overhead was $400,000, based on practical capacity of 32,000 direct labor hours.

Required:

1. Calculate the standard fixed overhead rate based on budgeted fixed overhead and practical capacity. $fill in the blank 1

2. Compute the fixed overhead spending and volume variances. Enter amounts as positive numbers and select Favorable or Unfavorable.

Spending variance $fill in the blank 2
FavorableUnfavorable
Volume variance $fill in the blank 4
FavorableUnfavorable

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Kermit D. Larson, Paul B. W. Miller

5th Edition

0256091935, 978-0256091939

More Books

Students also viewed these Accounting questions

Question

Question 1 (a2) What is the reaction force Dx in [N]?

Answered: 1 week ago