Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 04 Aug 2017 My Price 7.00

Missoula Manufacturing Company

Calculating factory overhead: two variances

Missoula Manufacturing Company normally produces 10,000 units of product X each month. Each unit requires 2 hours of direct labor, and factory overhead is applied on a direct labor hour basis. Fixed costs and variable costs in factory overhead at the normal capacity are $5 and $3 per unit, respectively. Cost and production data for May follow:

Production for the month

9,000 units

Direct labor hours used

18,500 hours

Factory overhead incurred for:

  

Variable costs

$28,500

Fixed costs

$52,000

a. Calculate the controllable variance.

b. Calculate the volume variance.

c. Was the total factory overhead under- or over applied? By what amount?

Answers

Maurice Tutor
(5)
Status NEW Posted 04 Aug 2017 09:08 PM My Price 7.00

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