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The Whole Bread Company bakes baguettes for distribution to upscale grocery stores. The company has two direct-cost categories: direct materials and direct manufacturing labor. The
The Whole Bread Company bakes baguettes for distribution to upscale grocery stores. The company has two direct-cost categories: direct materials and direct manufacturing labor. The Whole Bread Company allocates fixed manufacturing overhead to products on the basis of standard direct manufacturing labor-hours. For 2020 , fixed manufacturing overhead was budgeted at $4.00 per direct manufacturing labor-hour. Actual fixed manufacturing overhead incurred during the year was $290,000. The following is some budget data for the Whole Bread Company for 2020 and additional infomation for the year ended Decmeber 31, 2020: (Click the icon to view the budget data.) (Click the icon to view the additional data.) Read the Data table Requirements Data table 1. Prepare a variance analysis of fixed manufacturing overhead cost. 2. Is fixed overhead underallocated or overallocated? By what amount? 3. Comment on your results. Discuss the variances and explain what may be driving them
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