During the current month, the company operated at 55% of capacity, employees worked 728,000 hours, and the following actual overhead costs were incurred.

Use the following information for the Exercises below.

[The following information applies to the questions displayed below.] Sedona Company set the following standard costs for one unit of its product for 2017.

Direct material (30 Ibs. @ $2.20 per Ib.)		$	66.00
Direct labor (20 hrs. @ $4.20 per hr.)			84.00
Factory variable overhead (20 hrs. @ $2.20 per hr.)			44.00
Factory fixed overhead (20 hrs. @ $1.10 per hr.)			22.00
Standard cost		$	216.00

The $3.30 ($2.20 + $1.10) total overhead rate per direct labor hour is based on an expected operating level equal to 60% of the factory's capacity of 68,000 units per month. The following monthly flexible budget information is also available.

		Operating Levels (% of capacity)
Flexible Budget			55%				60%				65%
Budgeted output (units)			37,400				40,800				44,200
Budgeted labor (standard hours)			748,000				816,000				884,000
Budgeted overhead (dollars)
Variable overhead		$	1,645,600			$	1,795,200			$	1,944,800
Fixed overhead			897,600				897,600				897,600
Total overhead		$	2,543,200			$	2,692,800			$	2,842,400

During the current month, the company operated at 55% of capacity, employees worked 728,000 hours, and the following actual overhead costs were incurred.

Variable overhead costs		$	1,625,000
Fixed overhead costs			924,300
Total overhead costs		$	2,549,300

AH = Actual Hours SH = Standard Hours AVR = Actual Variable Rate SVR = Standard Variable Rate SFR = Standard Fixed Rate

Exercise 21-18A Computation and interpretation of overhead spending, efficiency, and volume variances LO P4

1. Compute the variable overhead spending and efficiency variances.

AH = Actual Hours SH = Standard Hours AVR = Actual Variable Rate SVR = Standard Variable Rate SFR = Standard Fixed Rate

Exercise 21-17 Computation of total variable and fixed overhead variances LO P3