Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: 7,000 70% Denominator volume-number of
Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: 7,000 70% Denominator volume-number of units Denominator volume-percent of capacity Denominator volume-standard direct labor hours (DLHs) Budgeted variable factory overhead cost at denominator volume Total standard factory overhead rate per DLH 21,000 $102,500 $ 15.10 During 2019, Bluecap worked 27,000 DLHs and manufactured 9,600 units. The actual factory overhead cost for the year was $13,000 greater than the flexible budget amount for the units produced, of which $7,000 was due to fixed factory overhead. In preparing a budget for 2020 Bluecap decided to raise the level of operation to 90% of capacity (a level it considers to be "practical capacity'), to manufacture 9,000 units at a budgeted total of 27,000 DLHs. The fixed overhead production volume variance for Bluecap Co. in 2019, to the nearest dollar, was: (Round your intermediate calculation to
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