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Leaky Canoes Ltd. controls variable manufacturing overhead costs with assembly-line hours as the denominator. Fixed manufacturing overhead costs are applied on a unit-of-output basis. Each
Leaky Canoes Ltd. controls variable manufacturing overhead costs with assembly-line hours as the denominator. Fixed manufacturing overhead costs are applied on a unit-of-output basis. Each canoe is allowed 10 assembly-line hours and standard variable manufacturing overhead totals $650 per unit. Budgeted fixed manufacturing overhead totals $29,400 for 420 canoes. During July 4,200 assembly-line hours were incurred and 400 canoes were produced. Actual manufacturing overhead costs for July were $260,400 for variable expenses and $32,300 for fixed expenses. Required: a. Compute a 4-variance analysis for the month of July (8 marks)
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