Oriole Clothiers is a small company that manufactures tall-men's suits. The company has used a standard cost accounting system. InMay 2022, 10,300 suits were produced. The following standard and actual cost data applied to the month of May, when normalcapacity was 13,905 direct labor hours. All materials purchased were used.Cost ElementDirectmaterialsDirect laborOverhead8 yards at $4.70 per yard1.45 hours at $13.40 per hour1.45 hours at $6.80 per hour (fixed $3.80; variable$3.00)Standard (per unit)Overhead controllable variance $Overhead volume variance$ActualOverhead is applied on the basis of direct labor hours. At normal capacity, budgeted fixed overhead costs were $52,839, and budgetedvariable overhead was $41,715.Compute the overhead controllable variance and the overhead volume variance.$373,500 for 83,000 yards ($4.50 per yard)$217,327 for 15,635 hours ($13.90 per hour)$48,000 fixed overhead $36,500 variableoverhead

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Description: Oriole Clothiers is a small company that manufactures tall-men's suits. The company has used a standard cost accounting system. InMay 2022, 10,300 suits were produced. The following standard and actual cost data applied to the month of May, when nor

Overhead controllable variance=Flexible budget overhead-Total actual overhead Overhead volume…

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Compute the overhead controllable variance and the overhead volume variance.

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Concept explainers

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.

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Oriole Clothiers is a small company that manufactures tall-men's suits. The company has used a standard cost accounting system. In
May 2022, 10,300 suits were produced. The following standard and actual cost data applied to the month of May, when normal
capacity was 13,905 direct labor hours. All materials purchased were used.
Cost Element
Direct
materials
Direct labor
Overhead
8 yards at $4.70 per yard
1.45 hours at $13.40 per hour
1.45 hours at $6.80 per hour (fixed $3.80; variable
$3.00)
Standard (per unit)
Overhead controllable variance $
Overhead volume variance
$
Actual
Overhead is applied on the basis of direct labor hours. At normal capacity, budgeted fixed overhead costs were $52,839, and budgeted
variable overhead was $41,715.
Compute the overhead controllable variance and the overhead volume variance.
$373,500 for 83,000 yards ($4.50 per yard)
$217,327 for 15,635 hours ($13.90 per hour)
$48,000 fixed overhead $36,500 variable
overhead

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