Question
NOTE: I just need help with Problems 5 & 6 towards the bottom. -- Walkenhorst Companys machining department prepared its 2016 budget based on the
NOTE: I just need help with Problems 5 & 6 towards the bottom.
--
Walkenhorst Companys machining department prepared its 2016 budget based on the following data:
Practical capacity | 40,000 | Units |
Machine hours per unit | 2.00 | |
Variable factory overhead | $3.00 | Per machine hour |
Fixed factory overhead | $392,000 |
The department uses machine hours to apply factory overhead. In 2016, the department used 85,400 machine hours and $653,000 in total manufacturing overhead to manufacture 42,030 units. Actual fixed overhead for the year was $399,000. |
Required: | |
Determine for the year: | |
1. | The variable, fixed, and total factory overhead application rates. (Round your answers to 2 decimal places.) |
Variable overhead application rate | $ 3.00 |
Fixed overhead application rate | $ 4.90 |
Total Factory overhead application rate | $ 7.90 |
2. | The flexible budget for overhead cost based on output achieved in 2016. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) |
Flexible budget for overhead cost | $ 644,180 |
3. | The fixed overhead production volume variance. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) |
Fixed overhead production volume variance | $ 19,894 | Favorable |
4. | The total overhead spending variance. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) |
Spending variance | $ 4,800 | Unfavorable |
5. | The overhead efficiency variance. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) |
Efficiency variance | Unfavorable |
6. | The variable and fixed overhead spending variances. (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) |
Variable overhead | Favorable | |
Fixed overhead | Favorable
|
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