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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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Solution Summary

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

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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 ...

Purchase this Solution
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