Purchase Solution

Standard costs

Not what you're looking for?

Ask Custom Question

The loan department of local bank uses standard costs to determine the overhead cost of processing loan applications. During the current month a fire occurred, and the accounting records for the department were mostly destroyed. The following data were salvaged from the ashes.

Standard variable overhead rate per hour $9
Standard hours per application 2
Standard hours allowed 2,000
Standard fixed overhead rate per hour $6
Actual fixed overhead cost $13,200
Variable overhead budget based on standard hours allowed $18,000
Fixed overhead budget $13,200
Overhead controllable variance $ 1,500

1) Determine the following:

a. Total actual overhead cost
b. Actual variable overhead cost
c. Variable overhead cost applied
d. Fixed overhead cost applied
e. Overhead volume variance

2) Determine how many loans were processed.

Purchase this Solution
Solution Summary

The solution explains how to calculate the overhead applied and the overhead volume variance.

Purchase this Solution
Free BrainMass Quizzes
Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Learning Lean

This quiz will help you understand the basic concepts of Lean.

Operations Management

This quiz tests a student's knowledge about Operations Management

View More Free Quizzes
Related BrainMass Solutions

  • manufacturing cost allocation

    The overheads are based on actual costs and standard costs are costs expected by the manufacturer.

  • Stadard Costs/Ideal and Normal Standard

    206366 Stadard Costs/Ideal and Normal Standard Standard costs facilitate management planning. What are the other advantages of standard costs? Please distinguish between an ideal standard and a normal standard.

  • Computing the Activity Variance

    $5,303 U An activity variance isolates activity for the month by pricing actual activity at standard costs and comparing that to standard activity at standard costs.

  • Standard Costing Model In Workplace

    Some overtime wages were reduced and even regular wages were reduced to 'achieve' the standard costs. Among the workers, standard costs were a terror. Step 2 There were many problems with standard costing that I faced in the workplace.

  • Winnipeg Chemical Company

    Standard direct-labor hours per finished unit, 6 hours. See attached file for clarity. The Winnipeg Chemical Company uses flexible budgets and a standard cost system. ? Direct-labor costs incurred, 12,000 hours,$150,000 ?

  • Standard costs and variances

    Standard costs are used for recording the information but the financial reporting is based on actual costs. If the standard costs are inaccurate, that would still not have any impact on financial reporting.

  • Performance evaluation: standard vs. actual practices

    Standard costing is different from actual costing methods in that standard costing is estimated costs and normal costing is actual costs.

  • Standard Cost System/Overhead Variances

    286814 Standard Cost System/Overhead Variances Study Appendix 13 The Winnipeg Chemical Company uses flexible budgets and a standard cost system. ? Direct-labor costs incurred, 12,000 hours, $150,000 ?

  • Standard Cost and Variances

    Week 4 DQ 1 What are some of the advantages and disadvantages of standard costs? How do managers determine what the standard cost should be? Describe the effect of inaccurate standard costs on financial reporting.

  • Compute variances for direct materials, labor, variable OH

    The standard costs associated with this football, along with the actual costs incurred last year, are given below (per football): Standard Costs and Operating Performance Measures Standard Cost Actual Cost Direct materials: Standard: 3.7 feet

View More Related Solutions