Data tableStatic budget variable overhead$2,300Static budget fixed overhead$23,000Static budget direct labor hours575 hoursStatic budget number of units23,000 unitsStandard direct labor hours0.025 hours per fenderPrintDoneRequirements1. Compute the overhead variances for the year: variable overhead costvariance, variable overhead efficiency variance, fixed overhead cost variance,and fixed overhead volume variance.2. Explain why the variances are favorable or unfavorable.PrintDone Quality Fender uses a standard cost system and provide the following information:m (Click the ioon to view the information.)Quality Fender allocates manufacturing overhead to production based on standard direct labor hours. Quality Fender reported the folowing actual resuits for 2024:actual number of fenders produced, 20,000; actual variable overhead, $5,300; actual fixed overhead, $34,000, actual direct labor hours, 360.Read the requirementsRequirement 1. Compute the overhead variances for the year. variable overhead cost variance, variable overhead efficiency variance, fixed overthead cost variance,and fixed overhead volume variance.Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances, and identitwhether each variance is favorable (F) or unfavorable (U). (You may need to simply the formula based on the data provided. Abbreviations used: AC = actual cost AC= actual quantity, FOH = fxed overhead; SC standard cost SQ = standard quantity, VOH = variable overhead.)FormulaVarianceVOH cost varianceVOH efficiency variance

Name: Data tableStatic budget variable overhead$2,300Static budget fixed ov
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Description: Data tableStatic budget variable overhead$2,300Static budget fixed overhead$23,000Static budget direct labor hours575 hoursStatic budget number of units23,000 unitsStandard direct labor hours0.025 hours per fenderPrintDoneRequirements1. Compute the

Solution:- Given, Quality Fender uses a standard cost system No. of fenders produced = 20,000…

Business

Accounting

Requirements 1. Compute the overhead variances for the year: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. 2. Explain why the variances are favorable or unfavorable.

Requirements 1. Compute the overhead variances for the year: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. 2. Explain why the variances are favorable or unfavorable.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following information was taken from the annual manufacturing overhead cost budget of Tamarisk Company: Variable manufacturing overhead costs Fixed manufacturing overhead costs Normal production level in labour hours Normal production level in units Standard labour hours per unit $35,260 $18,860 16,400 4,100 4 During the year, 4,000 units were produced, 16,300 hours were worked, and the actual manufacturing overhead was $55,600. Actual fixed manufacturing overhead costs equalled the budgeted fixed manufacturing overhead costs. Overhead is applied based on direct labour hours.
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