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OH variances The manager of the Texas Department of Transportation has determined that it typically takes 3 0 minutes for the department s employees to

OH variances
The manager of the Texas Department of Transportation has determined that it typically takes 30 minutes for the departments employees to register a new car. In Bexar County, the predetermined fixed overhead rate was computed on an estimated 12,000 direct labor hours per month and is $9 per direct labor hour, whereas the predetermined variable overhead rate is $3 per direct labor hour.
During July, 22,560 cars were registered in Bexar County, and 11,400 direct labor hours were worked in registering those vehicles. For the month, variable overhead was $33,240 and fixed overhead was $108,960.
Note: In answering the following questions, do not use negative signs with your answers.
a. Compute overhead variances using a four-variance approach.
VOH Spending Variance
Actual VOH - Budgeted VOH = VOH Spending Variance
Answer
- Answer
= Answer
Answer
VOH Efficiency Variance
Budgeted VOH - Applied VOH = VOH Efficiency Variance
Answer
- Answer
= Answer
Answer
FOH Spending Variance
Actual FOH - Budgeted FOH = FOH Spending Variance
Answer
- Answer
= Answer
Answer
FOH Volume Variance
Budgeted FOH - Applied FOH = FOH Volume Variance
Answer
- Answer
= Answer
Answer
b. Compute overhead variances using a three-variance approach.
OH Spending Variance
Actual OH - Budget at Actual = OH Spending Variance
Answer
- Answer
= Answer
Answer
OH Efficiency Variance
Budget at Actual - Budget at Standard = OH Efficiency Variance
Answer
- Answer
= Answer
Answer
Volume Variance
Budget at Standard - Applied OH = Volume Variance
Answer
- Answer
= Answer
Answer
c. Compute overhead variances using a two-variance approach.
Budget Variance
Actual OH - Budgeted OH = Budget Variance
Answer
- Answer
= Answer
Answer
Volume Variance
Budgeted OH - Applied OH = Volume Variance
Answer
- Answer
= Answer
Answer

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