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Weaver Company: spending & efficiency variance for variable

Part 8: Weaver Company.

Weaver Company has developed standard overhead costs based on a capacity of 180,000 machine hours as follows:

Standard costs per unit:
Variable portion 2 hours @ $3 = $ 6
Fixed portion 2 hours @ $5 = 10
$16

During April, 85,000 units were scheduled for production, but only 80,000 units were actually produced. The following data relate to April:

Actual machine hours used were 165,000.
Actual overhead incurred totaled $1,378,000 ($518,000 variable plus $860,000 fixed).
All inventories are carried at standard cost.

a. The variable overhead spending variance for April was

b. The variable overhead efficiency variance for April was

c. The fixed overhead spending variance for April was

d. The fixed overhead volume variance for April was

Solution Preview

Part 8: Weaver Company.

Weaver Company has developed standard overhead costs based on a capacity of 180,000 machine hours as follows:

Standard costs per unit:
Variable portion 2 hours @ $3 = $ 6
Fixed portion 2 hours @ $5 = 10
$16

During April, 85,000 units were scheduled for production, but only 80,000 units were actually produced. The following data relate to ...

Solution Summary

This solution is comprised of a detailed explanation to answer what is the variable overhead spending variance for April.

$2.19