Blaze Corporation allocates overhead on the basis of DLH and the standard amount per allocation base is 3.00 DLH per unit. For March, the company planned production of 10,000 units (80% of its production capacity of 12,500 units) and prepared the following budget. The company actually operated at 90% capacity (11,250 units) in March and incurred actual total overhead costs of $179,660. Overhead Budget Production in units. Budgeted variable overhead Budgeted fixed overhead 80% Operating Levels 10,000 $ 81,000 $ 96,000 1. Compute the standard overhead rate. Hint Standard allocation base at 80% capacity is 30,000 DLH, computed as 10,000 units x 3.00 DLH per unit. 2. Compute the total overhead varlance. 3. Compute the overhead controllable variance. 4. Compute the overhead volume varlance.

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Blaze Corporation allocates overhead on the basis of DLH and the standard amount per allocation base is 3.00 DLH per unit. For
March, the company planned production of 10,000 units (80% of its production capacity of 12,500 units) and prepared the following
budget. The company actually operated at 90% capacity (11,250 units) in March and incurred actual total overhead costs of $179,660.
Overhead Budget
Production in units
Budgeted variable overhead
Budgeted fixed overhead
80% Operating
Levels
10,000
$ 81,000
$ 96,000
1. Compute the standard overhead rate. Hint Standard allocation base at 80% capacity is 30,000 DLH, computed as 10,000 units x
3.00 DLH per unit.
2. Compute the total overhead variance.
3. Compute the overhead controllable variance.
4. Compute the overhead volume variance.
Transcribed Image Text:Blaze Corporation allocates overhead on the basis of DLH and the standard amount per allocation base is 3.00 DLH per unit. For March, the company planned production of 10,000 units (80% of its production capacity of 12,500 units) and prepared the following budget. The company actually operated at 90% capacity (11,250 units) in March and incurred actual total overhead costs of $179,660. Overhead Budget Production in units Budgeted variable overhead Budgeted fixed overhead 80% Operating Levels 10,000 $ 81,000 $ 96,000 1. Compute the standard overhead rate. Hint Standard allocation base at 80% capacity is 30,000 DLH, computed as 10,000 units x 3.00 DLH per unit. 2. Compute the total overhead variance. 3. Compute the overhead controllable variance. 4. Compute the overhead volume variance.
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