Duvet Company manufactures pillows. The 2017 operating budget was based on production of 25,000 pillows, with 0.75 machine-hours allowed per pillow. Budgeted variable overhead per hour was $25. Actual production for 2017 was 27,000 pillows using 19,050 machine-hours. Actual variable costs were $23 per machine-hour. Calculate the following: a. the budgeted variable overhead for 2017; b. the variable overhead spending variance; and c. the variable overhead efficiency variance.
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.
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