Variable Overhead variances: Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories: Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: V a r i a b l e o v e r h e a d r a t e v a r i a n c e = ( A c t u a l V a r i a b l e o v e r h e a d r a t e – S t a n d a r d v a r i a b l e o v e r h e a d r a t e ) × A c t u a l h o u r s Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula: V a r i a b l e o v e r h e a d e f f i c i e n c y v a r i a n c e = ( A c t u a l H o u r s – S t a n d a r d h o u r s ) × S t a n d a r d V a r i a b l e o v e r h e a d r a t e Journal Entry : In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal. To indicate: The journal entry to record the Variable Overhead cost and related variances.

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Answer 1

Question

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

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Answer 2

Question

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

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Answer 3

Question

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

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Answer 4

Question

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

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Answer 5

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

Answer 6

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

Answer 7

Chapter 9, Problem 3.3GAP

To determine

Concept introduction:

Variable Overhead variances:

Direct labor variances refer to the difference between the standard direct labor cost and actual direct labor cost incurred. Direct labor cost variances are categorized into following categories:

Variable overhead rate variance: The variable overhead rate variance is calculated with the help of following formula: Variable overhead rate variance = ( Actual Variable overhead rate – Standard variable overhead rate ) ×Actual hours

Variable overhead efficiency variance: The variable overhead efficiency variance is calculated with the help of following formula:

Variable overhead efficiency variance = (Actual Hours –Standard hours ) ×Standard Variable overhead rate

Journal Entry: In journal entry company records all the business transactions which are in monetary form. Company records the transaction on debit and credit in journal entry which are always equal.

To indicate:

The journal entry to record the Variable Overhead cost and related variances.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 9 - Briefly describe the difference between budgetary...Ch. 9 - What are standard costs? When are they set?Ch. 9 - Prob. 3Q Ch. 9 - Prob. 4Q Ch. 9 - Prob. 5Q Ch. 9 - Prob. 6Q Ch. 9 - Prob. 7Q Ch. 9 - Prob. 8Q Ch. 9 - Prob. 9Q Ch. 9 - How do the master budget, flexible budget, and...

Solution Summary: The author explains how the variable overhead rate variance is calculated with the help of the following formula:

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