Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare an overhead variance report at the actual activity level of 9,000 units. Classify as favorable or unfavorable. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance. Do not round intermediate calculations.) JAMES CORP. Overhead Variance Report For Month Ended May 31 Expecte production 80% of capacity volume 90% of capacity Production level achieved Favorable 5,125 Volume variance Actual Flexible Budget Controllable Variance Variances Fav./Unfav. Results Variable overhead costs: Favorable Indirect materials 18,000 16,000 2,000 Favorable Indirect labor 22,500 22,200 300 No variance 5,625 Power 5,625 Unfavorable 3,375 Maintenance 3,975 600 Favorable Total variable costs 47,800 49,500 1,700 Fixed overhead costs: No variance Rent of factory building 16,000 16,000 0 10,100 No variance Depreciation-Machinery 10.100 0 809 Unfavorable Supervisory salaries 16,791 17,600 Unfavorable 42,891 809 Total fixed costs 43,700 Unfavorable 92.391 91,500 891 Total overhead costs
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
James Corp. applies
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Operating Levels |
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Overhead Budget |
80% |
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Production in units |
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8,000 |
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Standard direct labor hours |
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20,000 |
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Budgeted overhead |
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Variable overhead costs |
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Indirect materials |
$ |
16,000 |
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Indirect labor |
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20,000 |
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Power |
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5,000 |
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Maintenance |
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3,000 |
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Total variable costs |
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44,000 |
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Fixed overhead costs |
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Rent of factory building |
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16,000 |
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10,100 |
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Supervisory salaries |
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14,900 |
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Total fixed costs |
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41,000 |
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Total overhead costs |
$ |
85,000 |
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During May, the company operated at 90% capacity (9,000 units) and incurred the following actual overhead costs:
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Overhead costs (actual) |
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Indirect materials |
$ |
16,000 |
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Indirect labor |
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22,200 |
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Power |
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5,625 |
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Maintenance |
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3,975 |
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Rent of factory building |
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16,000 |
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Depreciation—Machinery |
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10,100 |
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Supervisory salaries |
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17,600 |
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Total actual overhead costs |
$ |
91,500 |
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1.Compute the overhead controllable variance and classify it as favorable or unfavorable.
2.Compute the overhead volume variance and classify it as favorable or unfavorable.
3. Prepare an overhead variance report at the actual activity level of 9,000 units.
NEED HELP FOR FIGURING OUT THE SUPERVISORY SALARY SEE WHERE I AM MARKED WRONG FOR IT, LOOING FOR THE FORMULA PLEASE HELP!!!!
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