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Sedona Company set the following standard costs for one unit of its product for this year Direct terial (15 pounds 53.40 per pound) Direct labor (1e hourss9.70 per DLH) Veriable overhead (10 hours e $4.90 per DLH) Fised overhead (10 hours $2.00 per DLH) Standard cost per unit $$1.00 97,00 49.00 20.00 $ 217.00 The $6.90 ($4.90 $2.00) total overhead rate per direct labor hour (DLH) is based on a predicted activity level of 41,300 units, which is 70% of the factory's capacity of 59.000 units per month. The following monthly flexible budget information Is avallable. Operat ing levels (K of capacity) 70 41, 00 41), 00 lexible Budget Budgeted production (units) udgeted direct labor (standard hours) Budgsted everhead Variable overhead Fised overhead Total evertead 30, 5e 363,500 75 44,250 442, 500 $ 1,879,150 826, 000 $2,705,150 $ 2,023, 700 826, 000 $2,49, 700 $2,168,250 126, 00 $2,994,25e During the current month, the company operated at 65% of capacity, direct labor of 365,000 hours were used, and the following actual overhead costs were incurred. Actual variable overhead Actual fiad overhead Actuel total verhead $1,816,000 899,050 52,715,ese

Sedona Company set the following standard costs for one unit of its product for this year Direct terial (15 pounds 53.40 per pound) Direct labor (1e hourss9.70 per DLH) Veriable overhead (10 hours e $4.90 per DLH) Fised overhead (10 hours $2.00 per DLH) Standard cost per unit $$1.00 97,00 49.00 20.00 $ 217.00 The $6.90 ($4.90 $2.00) total overhead rate per direct labor hour (DLH) is based on a predicted activity level of 41,300 units, which is 70% of the factory's capacity of 59.000 units per month. The following monthly flexible budget information Is avallable. Operat ing levels (K of capacity) 70 41, 00 41), 00 lexible Budget Budgeted production (units) udgeted direct labor (standard hours) Budgsted everhead Variable overhead Fised overhead Total evertead 30, 5e 363,500 75 44,250 442, 500 $ 1,879,150 826, 000 $2,705,150 $ 2,023, 700 826, 000 $2,49, 700 $2,168,250 126, 00 $2,994,25e During the current month, the company operated at 65% of capacity, direct labor of 365,000 hours were used, and the following actual overhead costs were incurred. Actual variable overhead Actual fiad overhead Actuel total verhead $1,816,000 899,050 52,715,ese

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...
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1. Compute the total varlable overhead varlance and identify It as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavoreble, or no varinnce.) 2. Compute the total fixed overhead varlance and identify it as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavorable, or no variance.) At 66% of Operating Capacity- standard Direct Labor Hours Overhead Rate Standard Direct Labor Favorable/Unfavorable Standard Overhead Applied Actual Overhead Hours Overhead Variance Variable overhead variance Fixed overhead variance 4 90 2.00 699.050
Transcribed Image Text:1. Compute the total varlable overhead varlance and identify It as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavoreble, or no varinnce.) 2. Compute the total fixed overhead varlance and identify it as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavorable, or no variance.) At 66% of Operating Capacity- standard Direct Labor Hours Overhead Rate Standard Direct Labor Favorable/Unfavorable Standard Overhead Applied Actual Overhead Hours Overhead Variance Variable overhead variance Fixed overhead variance 4 90 2.00 699.050
Sedona Company set the following standard costs for one unit of its product for this year. Direct material (15 pounds $3.40 per pound) Direct labor (10 hours e S9.70 per DLH) Veriable overhead (10 hours $4.90 per DLH) Fied overhead (10 hours $2. 00 per DLH) Standard cost per unit $ 51.00 97.00 49.00 20.00 $ 217.00 The $6.90 ($4.90 - $2.00) total overhead rate per direct labor hour (DLH) is based on a predicted activity level of 41,300 units, which is 70% of the factory's capacity of 59,000 units per month. The following monthly flexible budget information Is avallable. Operat ing Levels (K of capacity) 65% 30, 350 383,500 Flexible Budget Budgeted production (units) Rudgeted direct labor (standard hours) Budgeted overhead Varlable overhead Fised overhead Total avertead 41, 300 413,000 75% 44, 250 442, 500 $1,879,150 826,000 $ 2,023, 700 826, 000 $ 2,849, 700 $2,168, 250 126, e00 $ 2,994, 250 $ 2,705, 150 During the current month, the company operated at 65% of capacity, direct labor of 365,000 hours were used, and the following actual overhead costs were incurred. Actual varlable overhead Actual fised overhead Actuel total overhead $1,16, 000 899,050 $ 2,715,05e
Transcribed Image Text:Sedona Company set the following standard costs for one unit of its product for this year. Direct material (15 pounds $3.40 per pound) Direct labor (10 hours e S9.70 per DLH) Veriable overhead (10 hours $4.90 per DLH) Fied overhead (10 hours $2. 00 per DLH) Standard cost per unit $ 51.00 97.00 49.00 20.00 $ 217.00 The $6.90 ($4.90 - $2.00) total overhead rate per direct labor hour (DLH) is based on a predicted activity level of 41,300 units, which is 70% of the factory's capacity of 59,000 units per month. The following monthly flexible budget information Is avallable. Operat ing Levels (K of capacity) 65% 30, 350 383,500 Flexible Budget Budgeted production (units) Rudgeted direct labor (standard hours) Budgeted overhead Varlable overhead Fised overhead Total avertead 41, 300 413,000 75% 44, 250 442, 500 $1,879,150 826,000 $ 2,023, 700 826, 000 $ 2,849, 700 $2,168, 250 126, e00 $ 2,994, 250 $ 2,705, 150 During the current month, the company operated at 65% of capacity, direct labor of 365,000 hours were used, and the following actual overhead costs were incurred. Actual varlable overhead Actual fised overhead Actuel total overhead $1,16, 000 899,050 $ 2,715,05e
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