Elegant Designs is a manufacturer of large flower pots for urban settings. The company has these standards: (Click the icon to view the standards.) (Click the icon to view the actual results.) Requirements 1. Compute the variable manufacturing overhead variances. What do each of these variances tell management? 2. Compute the fixed manufacturing overhead variances. What do each of these variances tell management? - X Standard Price and Volume Direct materials (resin) Requirement 1. Compute the variable manufacturing overhead variances. What do each of these variances tell management? (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the ne Begin by computing the variable manufacturing overhead rate variance. First determine the formula for the rate variance, then compute the rate variance for variable manufacturing overhead. 10 pounds per pot at a cost of $3.00 per pound 5.0 hours at a cost of $19.00 per hour Variable overhead Actual hours Actual rate Standard rate ) = rate variance Direct labor Standard variable manufacturing overhead rate Budgeted fixed manufacturing overhead Standard fixed MOH rate $3.00 per direct labor hour x Now compute the variable manufacturing overhead efficiency variance. First determine the formula for the efficiency variance, then compute the efficiency variance for variable manufacturing overhead. $94.000 $12.00 per direct labor hour (DLH) Variable overhead efficiency variance x x Print Done What each of these variances tell management? The variable manufacturing overhead (MOH) rate variance tells managers that were than expected. The variable MOH efficiency variance tells managers that actual were than Requirement 2. Compute the fixed manufacturing overhead variances. What do each of these variances tell management? (Abbreviations used: MOH = manufacturing overhead. Enter the variances as positive numbers. Label the variances as favorable (F) or unfavorable (U).) Begin by computing the fixed manufacturing overhead budget variance. First determine the formula for the budget variance, then compute the budget variance for fixed manufacturing overhead. - X Actual Results Fixed MOH = budget variance Elegant Designs allocates fixed manufacturing overhead to production based on standard direct labor hours. Last month. Elegant Designs reported the following actual results for the production of 1.600 flower pots Now compute the fixed manufacturing overhead volume variance. First determine the formula for the volume variance, then compute the volume variance for fixed manufacturing overhead. Direct materials Fixed MOH Purchased 17.820 pounds at a cost of $3.50 per pound: Used 17,120 pounds to = volume variance What do each of these variances tell management? The fixed overhead budget variance tells managers that The fixed overhead volume variance tells managers that produce 1.600 pots Direct labor. Worked 5.5 hours per unit (8.800 total DLH) at a cost of $18.00 per hour Actual variable manufacturing overhead. $3.20 per direct labor hour for total actual variable manufacturing overhead of $28.160 Actual fixed manufacturing overhead ....... $93,500 Standard fixed manufacturing overhead allocated based on actual production $96.000 Print Done