Hawthom Foods processes bags of organic frozen fruits sold at specialty grocery stores. (Click the icon to view additional information.) Read the requirements. Requirement 1. How much variable overhead would have been allocated to production? How much foxed overhead would have been allocated to production? The variable overhead allocated to production is $ Now determine the fxed overhead allocated to production. The fixed overhead allocated to production is S Requirement 2. Compute the variable MOH rate variance and the variable MOH efficiency variance. What do these variances tell managers? Begin by determing the formula for the variable MOH rate variance, then calculate the variable overhead rate variance. (Enter the result as a positive number. Enter rates to two decimal places. Label the variance as favorable (F) or unfavorable (U)) Variable overhead x ( x ( rate variance This variance tells managers that Hawthorn Foods actually incurred | | on variable manufacturing overhead than they would have expected given the actual hours used. Now determine the formula or the variable efficiency vanance then calculate the efficiency variance. Enter he esu t as a positive number. Enter any rates to two dec mal places. Label the variance as a orable F or unfavorable U) Variable overhead More Info x ( x ( This variance tells managers that Hawthorn Foods used | | direct labor hours than anticpated for the actual volume of output. Requirement 3. Compute the fixed MOH budget variance and the fixed overhead volume variance. What do these variances tell managers? Begin by determing the formula for the fixed MOH budget variance, then calculate the fixed budget variance. (Enter the result as a positive nu The company allocates manufacturing overhead based on direct labor hours. Hawthom has budgeted fioxed manufacturing overhead for the year to be 5627,000. The predetermined fixed manufacturing overhead rate is $15.60 per direct labor hour, while the standard variable manufacturing overhead rate is $1.00 per direct labor hour. The direct labor standard for each case is one-quarter (0.25) of an hour. Fixed MOH The company actually processed 164,000 cases of frozen organic fruits during the year and incurred $673.470 of manufacturing overhead, Of this amount, $630,000 was fixed. The company budget variance also incurred a total of 41,400 direct labor hours. This variance tells us that Hawthorn Foods spent | than anticipated on fixed overhead costs. PrintDone Now determine the formula for the fixed overhead volume variance, then calculate the volume variance. (Enter the result as a positive number Fixed MOH s volume variance This variance tells managers that Hawthorn Foods produced | | cases of frozen organic fruits than originaly expected
