Question
Zelda Corp. makes pottery for people to store items in, Most of the indirect costs used to make these pots are associated with the manufacturing
Zelda Corp. makes pottery for people to store items in, Most of the indirect costs used to make these pots are associated with the manufacturing process. This means that Samantha Inc. allocates variable and fixed manufacturing overhead on the basis of machine hours. On January 1st, Zelda Corp. planned on making 4,500 clay pots for the month. They believed it would take 10,125 machine hours and 2,250 direct labor hours to make these pots. They believed their total manufacturing overhead would be $95,175, with $60,750 coming from variable manufacturing overhead. On February 1st, found that for January they had made 4,450 clay pots and that on average, each pot took 2.3 machine hours and .6 direct labor hours to make. Their manufacturing overhead ended up being $101,933, with $42,570 coming from fixed manufacturing overhead. Using this information please conduct a 4 variance analysis for both Variable and Fixed Manufacturing Overhead.
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