Atlanta Company is preparing its manufacturing overhead budget for 2020. Relevant data consist of the following. Units to be produced (by quarters): 10,200, 12,400, 14,700, 16,700. Direct labor: Time is 1.6 hours per unit. Variable overhead costs per direct labor hour: indirect materials $0.80; indirect labor $ 1.30; and maintenance $0.60. Fixed overhead costs per quarter: supervisory salaries $ 36,320; depreciation $ 18,770; and maintenance $ 14,330. Prepare the manufacturing overhead budget for the year, showing quarterly data. (Round overhead rate to 2 decimal places, e.g. 1.25. List variable expenses before fixed expense.) Direct labor hours Manufacturing overhead rate per direct labor hour $ $ $ ATLANTA COMPANY Manufacturing Overhead Budget Quarter $

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Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.