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The standard factory overhead rate is $12 per machine hour ($10 for variable factory overhead and $2 for fixed factory overhead) based on 100% capacity
The standard factory overhead rate is $12 per machine hour ($10 for variable factory overhead and $2 for fixed factory overhead) based on 100% capacity of 42,000 machine hours. The standard cost and the actual cost of factory overhead for the production of 2,000 units were as follows:
Actual: Variable factory overhead $350,500 Fixed factory overhead 84,000 Standard: 35,000 hours @ $12 420,000
Determine the (a) volume variance, (b) controllable variance, and (c) total factory overhead cost variance.
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