The cost of each suit is the sum of three variable costs (direct material costs, direct manufacturing labor costs, and manufacturing overhead costs) and one fixed- cost category (manufacturing overhead costs).

Variable manufacturing overhead cost is allocated to each suit on the basis of budgeted direct manufacturing labor-hours per suit.

For June 2018, each suit is budgeted to take 4 labor-hours.

Budgeted variable manufacturing overhead cost per labor- hour is $12.

The budgeted number of suits to be manufactured in June 2018 is 1,040.

Actual variable manufacturing costs in June 2018 were $52,164 for 1,080 suits started and completed.

Actual direct manufacturing labor-hours for June were 4,536.

There were no beginning or ending inventories of suits.

REQUUIREMENTS:

1. Compute the flexible- budget variance, the spending variance, and the efficiency variance for variable manufacturing overhead.

FIXED MANUFACTURING OVERHEAD, VARIANCE ANALYSIS

Esquire Clothing allocates fixed manufacturing overhead to each suit using budgeted direct manufacturing labor-hours per suit.

Data pertaining to fixed manufacturing overhead costs for June 2018 are budgeted, $62,400, and actual, $63,916.

REQUIREMENTS:

1. Compute the spending variance and production-volume variances for fixed manufacturing overhead.

For U PLAUSIBLE ROOT CAUSE OF EACH VARIANCE VARIABLE MANUFACTURING OVERHEAD (VMOH) VARIANCES VMOH spending variance VMOH efficiency variance FIXED MANUFACTURING OVERHEAD(FMOH) VARIANCES FMOH spending variance FMOH production-volume variance Label each varaince as Favorable of Unfavorable above. Show computations on the VMOH & FMOH Variances tab