Overhead Application, Overhead Variances, Journal Entri

Plimpton Company produces countertop ovens. Plimpton uses a standard costing system. The standard costing system relies on

direct labor hours to assign overhead costs to production. The direct labor standard indicates that two direct labor hours should be

used for every oven produced. The normal production volume is $100,000$ units. The budgeted overhead for the coming year is as

follows:

Fixed overhead

$$760,000$

Variable overhead

$446,{000}^{**}$

$*$At normal volume.

Plimpton applies overhead on the basis of direct labor hours.

During the year, Plimpton produced $97,000$ units, worked $196,000$ direct labor hours, and incurred actual fixed overhead costs of

$$770,500$ and actual variable overhead costs of $$437,540.$

Required:

Calculate the standard fixed overhead rate and the standard variable overhead rate. Round your answers to the nearest cent.

Use rounded answers in the subsequent computations.

Standard fixed overhead rate

Standard variable overhead rate

$

$

per direct labor hour

per direct labor hour

Compute the applied fixed overhead and the applied variable overhead. Use the application rates from part $(1)$ in your

calculations.

Fixed

Variable

$

$

What is the total fixed overhead variance?

$

What is the total variable overhead variance?

$