ValuFlex Manufacturing uses standard costing. It allocates its manufacturing overhead (variable and fixed) to products using standard direct manufacturing labour hours (DLH) and develops its manufacturing overhead rate using the current annual budget.

The manufacturing overhead budget for 2021 is based on budgeted output of 672,000 units requiring 3,360,000 DLH. The company is able to schedule production uniformly throughout the year.

A total of 72,000 output units requiring 321,000 DLH was produced during May 2021 and manufacturing costs incurred in that month amounted to $355,800. The actual costs, compared with the annual budget and on-twelfth of the annual budget are as follows:

Required: Prepare an analysis of all variable manufacturing overhead and fixed manufacturing overhead variances, using the 4-variance analysis framework. As part of your analysis make sure to calculate the following:

Total manufacturing overhead costs allocated

Variable manufacturing overhead spending variance

Fixed manufacturing overhead spending variance

Variable manufacturing overhead efficiency variance

Production-volume variance

Submission:

ValuFlex Manufacturing uses standard costing. It allocates its manufacturing overhead (variable and fixed) to products using standard direct manufacturing labour hours (DLH) and develops its manufacturing overhead rate using the current annual budget. The manufacturing overhead budget for 2021 is based on budgeted output of 672,000 units requiring 3,360,000 DLH. The company is able to schedule production uniformly throughout the year. A total of 72,000 output units requiring 321,000 DLH was produced during May 2021 and manufacturing costs incurred in that month amounted to $355,800. The actual costs, compared with the annual budget and on-twelfth of the annual budget are as follows: Annual Manufacturing overhead budget 2021 Actual MOH Per DLH input Monthly MOH Total amount Per output unit budget May 2021 costs for May unit 2021 Variable MOH Indirect manufacturing labour $1,008,000 $1.5 50.30 $84,000 $84,000 Supplies $672,000 $1.00 $0.20 $56,000 $117,000 Fixed MOH Supervision $571,200 $0.85 $0.17 $47,600 $41,000 Utilities $369,600 $0.55 0.11 $30,800 $55,000 Depreciation $705,600 $1.09 $0.21 $58,800 $88,800 Total $3,326,400 $4.95 $0.99 $277,200 $385,800 Required: Prepare an analysis of all variable manufacturing overhead and fixed manufacturing overhead variances, using the 4-variance analysis framework. As part of your analysis make sure to calculate the following: a. Total manufacturing overhead costs allocated b. Variable manufacturing overhead spending variance c. Fixed manufacturing overhead spending variance d. Variable manufacturing overhead efficiency variance e. Production-volume variance Submission: Your submission should include Your Excel Workbook containing separate worksheets as follows: Data Calculations 4 variance analysis Variable overhead Fixed overhead