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Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives
Logistics Solutions provides order fulfillment services for
dot.com merchants. The company maintains warehouses that stock items
carried by its
dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which
pulls the item from storage, packs it and ships it to the customer. The company uses a predetermined variable overhead rate based
on direct laborhours.
In the most recent month, items were shipped to customers using direct laborhours. The company incurred a total of
$ in variable overhead costs.
According to the company's standards, direct laborhours are required to fulfill an order for one item and the variable overhead
rate is $ per direct laborhour.
Required:
What is the standard laborhours allowed SH to ship items to customers?
What is the standard variable overhead cost allowed to ship items to customers?
What is the variable overhead spending variance?
What is the variable overhead rate variance and the variable overhead efficiency variance?
For requirements and indicate the effect of each variance by selecting F for favorable, for unfavorable, and "None" for
no effect ie zero variance Input all amounts as positive values. Do not round intermediate calculations.
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