Question
The following information relates to Brookman, Inc.'s overhead costs for the month: (Click the icon to view the information.) Requirements 1. Compute the overhead
The following information relates to Brookman, Inc.'s overhead costs for the month: (Click the icon to view the information.) Requirements 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. 2. Explain why the variances are favorable or unfavorable. Requirement 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. Begin by selecting the formulas needed to compute the variable overhead (VOH) and fixed overhead (FOH) variances, and then compute each variance amount. (Actual cost - Standard cost) * Actual hours = =VOH cost variance (Actual hours - Standard hours allowed) * Standard cost = VOH efficiency variance = Actual overhead - Budgeted overhead Budgeted overhead - Allocated overhead = FOH cost variance = FOH volume variance = Data table Static budget variable overhead Static budget fixed overhead 8,000 $ 3,200 Static budget direct labor hours 1,600 hours Static budget number of units 4,000 units Brookman allocates manufacturing overhead to production based on standard direct labor hours. Last month, Brookman reported the following actual results: actual variable overhead, $10,100; actual fixed overhead, $2,780; actual production of 7,100 units at 0.20 direct labor hours per unit. The standard direct labor time is 0.4 direct labor hours per unit (1,600 static direct labor hours/ 4,000 static units). 3000 12780 2900
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