Meals Made Easy

MealsMadeEasy (MME

MME) operates a mealhome-delivery service. It has agreements with 20 restaurants to pick up and deliver meals to customers who place orders on MME

MME's website. MME

MME allocates variable and fixed overhead costs on the basis of delivery time. MME

MME's owner, Thomas

Thomas Stewart

Stewart, obtains the following information for May 2017

2017 overheadcosts:

Meals Made Easy (MME) operates a meal home-delivery service. It has agreements with 20 restaurants to pick up and deliver meals to customers who place orders on MME's website. MME allocates variable and fixed overhead costs on the basis of delivery time. MME's owner, Thomas Stewart, obtains the following information for May 2017 overhead costs: (Click the icon to view the information.) Read the requirements. Requirement 1. Compute spending and efficiency variances for MME's variable overhead in May 2017. Begin by calculating the following amounts for the variable overhead. (Round your answer to the nearest dollar.) Actual input Actual costs X Flexible incurred budgeted rate budget Variable OH $ 10,640 $ 8,960Actual Static Meals Made Easy (May 2017) Results Budget Output units (number of deliveries) 8,750 13,000 Hours per delivery 0.70 Hours of delivery time 5,600 Variable overhead cost per hour of delivery time Variable overhead costs $ 10,640 Fixed overhead costs $ 39,200 $ 36,400 1. Compute spending and efficiency variances for MME's variable overhead in May 2017. 2. Compute the spending variance and production-volume variance for MME's fixed overhead in May 2017. 3. Comment on MME's overhead variances and suggest how Thomas Stewart might manage MME's variable overhead differently from its fixed overhead costs