Question
Access systems allocates manufacturing overhead based on machine hours. Each connector should require 8 machine hours. According to the static budget, access expected to incur
Access systems allocates manufacturing overhead based on machine hours. Each connector should require 8 machine hours. According to the static budget, access expected to incur the following:
400 machine hours per month (50 connectors x 8 machine hours per connector)
4,000 in variable manufacturing overhead costs
5,325 in fixed manufacturing overhead costs
During August, Access actually used 500 machine hours to make 9090 connectors and spent $5,300 in variable manufacturing costs and $6,000
in fixed manufacturing overhead costs. Calculate the variable overhead cost variance for Access.
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