Question
Different management levels in Bates Inc. require varying degrees of cost accounting information. Because of the need to comply with the managers requests, three ways
Different management levels in Bates Inc. require varying degrees of cost accounting information. Because of the need to comply with the managers requests, three ways of variances analysis for manufacturing overhead are
computed each month. The information for the September overhead expenditures is as follows:
Budgeted output units 6400 units
Budgeted fixed manufacturing overhead $40,000
Budgeted variable manufacturing overhead $10 per direct labor hour
Budgeted direct manufacturing labor hours 4 hours per unit
Fixed manufacturing costs incurred $52,000
Direct manufacturing labor hours used 14,400
Variable manufacturing costs incurred $71,200
Actual units manufactured 6800
Compute a 3-way analysis of variance for the plant managers?
- Calculate the manufacturing overhead spending variance?
- Calculate the manufacturing overhead efficiency variance?
- Calculate the manufacturing overhead production volume variance?
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