Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Baird Company makes classic Polish sausage. The company uses a standard cost system to help control costs. Manufacturing overhead is applied to production on the
Baird Company makes classic Polish sausage. The company uses a standard cost system to help control costs. Manufacturing overhead is applied to production on the basis of standard direct laborhours. According to the companys planning budget, the following manufacturing overhead costs should be incurred at an activity level of laborhours the denominator activity level: Variable manufacturing overhead cost $ Fixed manufacturing overhead cost Total manufacturing overhead cost $ During the most recent year, the following operating results were recorded: Activity: Actual laborhours worked Standard laborhours allowed for the actual output Cost: Actual variable manufacturing overhead cost incurred $ Actual fixed manufacturing overhead cost incurred $ At the end of the year, the companys Manufacturing Overhead account contained the following data: Manufacturing Overhead Debit Credit Actual Applied Management would like to determine the cause of the $ underapplied overhead. Required: Round your answers to decimal places. Compute the predetermined overhead rate. Break the rate down into variable and fixed cost elements. Show how the $ Applied figure in the Manufacturing Overhead account was computed. Break down the $ underapplied overhead into four components: variable overhead rate variance, variable overhead efficiency varianc e fixed overhead budget variance, and fixed overhead volume variance. Indicate the effect of each variance by selecting F for favorable, U for unfavorable, and "None" for no effect ie zero variance Input all amounts as positive values.
Baird Company makes classic Polish sausage. The company uses a standard cost system to help control costs. Manufacturing overhead is applied to production on the basis of standard direct laborhours. According to the companys planning budget, the following manufacturing overhead costs should be incurred at an activity level of laborhours the denominator activity level:
Variable manufacturing overhead cost $
Fixed manufacturing overhead cost
Total manufacturing overhead cost $
During the most recent year, the following operating results were recorded:
Activity:
Actual laborhours worked
Standard laborhours allowed for the actual output
Cost:
Actual variable manufacturing overhead cost incurred $
Actual fixed manufacturing overhead cost incurred $
At the end of the year, the companys Manufacturing Overhead account contained the following data:
Manufacturing Overhead
Debit Credit
Actual Applied
Management would like to determine the cause of the $ underapplied overhead.
Required: Round your answers to decimal places.
Compute the predetermined overhead rate. Break the rate down into variable and fixed cost elements.
Show how the $ Applied figure in the Manufacturing Overhead account was computed.
Break down the $ underapplied overhead into four components: variable overhead rate variance, variable overhead efficiency varianc
e fixed overhead budget variance, and fixed overhead volume variance.
Indicate the effect of each variance by selecting F for favorable, U for unfavorable, and "None" for no effect ie zero variance Input all amounts as positive values.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started