Current Attempt in Progress Sweet Acacia Co. uses a standard job cost system with a normal capacity of 25,500 direct labour hours. Sweet Acacia Co. produces 12,400 units, which cost $211,500 for direct labour (23,500 hours), $28,024 for variable overhead, and $144,460 for fixed overhead. The standard variable overhead per unit is $2 (2 hours at $1 per hour), and the standard fixed overhead per unit is $10.40 (2 hours at $5.20 per hour). Calculate the fixed overhead spending (budget) variance. Fixed overhead spending variance $ Favourable Unfavourable Neither favourable nor unfavourable
Current Attempt in Progress Sweet Acacia Co. uses a standard job cost system with a normal capacity of 25,500 direct labour hours. Sweet Acacia Co. produces 12,400 units, which cost $211,500 for direct labour (23,500 hours), $28,024 for variable overhead, and $144,460 for fixed overhead. The standard variable overhead per unit is $2 (2 hours at $1 per hour), and the standard fixed overhead per unit is $10.40 (2 hours at $5.20 per hour). Calculate the fixed overhead spending (budget) variance. Fixed overhead spending variance $ Favourable Unfavourable Neither favourable nor unfavourable
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 3CE: Lansing. Inc., provided the following data for its two producing departments: Machine hours are used...
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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