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    Overhead variances

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    The following information is for the third quarter of this year:

    Planned Actual
    Production 92,000 units 87,000 units
    Direct labor hours 506,800 DL hrs 380,000 DL hrs
    Fixed Manufacturing Overhead $205,000 $182,400
    Variable manufacturing overhead $910,000 $841,500
    Standard direct labor hour per unit 5.5

    Required:
    Calculate the following three overhead variances:
    a) Overhead volume variance
    b) Overhead efficiency variance
    c) Overhead spending variance

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    https://brainmass.com/business/accounting/overhead-variances-444460

    Solution Preview

    Overhead Variances - Solution

    The following information is for the third quarter of this year:

    Planned Actual
    Production 92,000 units 87,000 units
    Direct labor hours 506,800 DL hrs 380,000 DL hrs
    Fixed Manufacturing ...

    Solution Summary

    Calculation and explanation of the overhead volume variance; the overhead efficiency variance; and the Overhead spending variance

    $2.19

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