Grand, in uses a n d cost system and provides the following information Click the icons to the stomation) Grand Mos manting Overhead to production based on standard director hours director hours, 1.300 Read the requirements and reported Requirement i Compute the variable overhea t and any wariances and feed overhead cost and volume Begin with the white condency waves w ere come the rise whead COM O wy FOHfed overhead, Sc d costs and quantity, VOH 20 ISTER nul views Now compune the end over costand volume wances Select the required to Fored overheat and sandard compute th EEEEEE >> 352 For volumewe Requirement 2. Explain why the variances are favorable or unfavorable. The variable overhead cost variance is because the actual cost per direct labor hour was than the standard cost per direct labor hour. The variable overhead efficiency variance is because management used direct labor hours than standard and variable overhead is applied (incurred) based on direct labor The fixed overhead cost variance is because the total fixed overhead cost was than the amount budgeted for total foued overhead. The fived overhead volume variance is because total fixed overhead cost allocated to units was than the total budgeted fixed overhead cost. Grand allocates manufacturing overhead to production based on standard direct labor hours. Grand reported the following actual results for 2018: actual number of units produced, 1,000, actual variable overhead, $3,800, actual fixed overhead, $3.000, actual direct labor hours, 1.800. Read the requirements Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances and ident whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost: AQ = actual quantity: FOH = foed overhead: SC = standard costs = standard quantity: VOH = variable overhead.) Formula Variance VOH cost variance VOH efficiency variance Now compute the fixed overhead cost and volume variances. Select the required formulas, compute the fixed overhead cost and volume variances, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost;AQ - actual quantity: FOH fixed overhead; SC standard cost, SO = standard quantity.) Formula Variance FOH cost variance FOH volume variance Requirement 2. Explain why the variances are favorable or unfavorable. Choose from any list or enter any number in the input fields and then continue to the next question Requirement 2. Explain why the variances are favorable or unfavorable. The variable overhead cost variance is because the actual cost per direct labor hour was than the standard cost per direct labor hour because management used direct labor hours than standard and variable overhead is applied The variable overhead efficiency variance is (incurred) based on direct labor The fixed overhead cost variance is because the total fixed overhead cost was than the amount budgeted for total fixed overhead. The fixed overhead volume variance is W because total fixed overhead cost allocated to units was than the total budgeted fixed overhead cost
