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Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 60,000 units of product are as follows: Variable factory overhead Fixed factory overhead Standard: 91,000 hrs. at $6.00 ($3.50 for variable factory overhead) Actual: Productive capacity at 100% of normal was 90,100 hours, and the factory overhead cost budgeted at the level of 91,000 standard hours was $542,700. Based on these data, the chief cost accountant prepared the following variance analysis Variable factory overhead controllable variance: Actual variable factory overhead cost incurred Budgeted variable factory overhead for 91,000 hours Variance-favorable Fixed factory overhead volume variance: Normal productive capacity at 100% Standard for amount produced Productive capacity not used Standard variable factory overhead rate Variance-unfavorable $315,300 318,500 S $315,300 226,000 546,000 90,100 hrs. 91,000 900 hrs. x $6.00 5,400 Total factory overhead cost variance-unfavorable $2,200 Compute the following to assist you in identifying the errors in the factory overhead cost variance analysis. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your interim computations to the nearest cent, if required. Variance Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance Amount $(3,200) Favorable/Unfavorable Favorable Favorable Favorable V - V - V

Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 60,000 units of product are as follows: Variable factory overhead Fixed factory overhead Standard: 91,000 hrs. at $6.00 ($3.50 for variable factory overhead) Actual: Productive capacity at 100% of normal was 90,100 hours, and the factory overhead cost budgeted at the level of 91,000 standard hours was $542,700. Based on these data, the chief cost accountant prepared the following variance analysis Variable factory overhead controllable variance: Actual variable factory overhead cost incurred Budgeted variable factory overhead for 91,000 hours Variance-favorable Fixed factory overhead volume variance: Normal productive capacity at 100% Standard for amount produced Productive capacity not used Standard variable factory overhead rate Variance-unfavorable $315,300 318,500 S $315,300 226,000 546,000 90,100 hrs. 91,000 900 hrs. x $6.00 5,400 Total factory overhead cost variance-unfavorable $2,200 Compute the following to assist you in identifying the errors in the factory overhead cost variance analysis. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your interim computations to the nearest cent, if required. Variance Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance Amount $(3,200) Favorable/Unfavorable Favorable Favorable Favorable V - V - V

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 60,000 units of product are as follows: Actual: Variable factory overhead $315,300 226,000 Fixed factory overhead Standard: 91,000 hrs. at $6.00 ($3.50 for variable factory overhead) 546,000 Productive capacity at 100% of normal was 90,100 hours, and the factory overhead cost budgeted at the level of 91,000 standard hours was $542,700. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred Budgeted variable factory overhead for 91,000 hours Variance-favorable Fixed factory overhead volume variance: Normal productive capacity at 100% Standard for amount produced Productive capacity not used Standard variable factory overhead rate Variance-unfavorable Variance $315,300 318,500 Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 90,100 hrs. 91,000 900 hrs. x $6.00 5,400 $2,200 Total factory overhead cost variance-unfavorable Compute the following to assist you in identifying the errors in the factory overhead cost variance analysis. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your interim computations to the nearest cent, if required. $(3,200) Amount Favorable/Unfavorable Favorable Favorable Favorable
Transcribed Image Text:Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 60,000 units of product are as follows: Actual: Variable factory overhead $315,300 226,000 Fixed factory overhead Standard: 91,000 hrs. at $6.00 ($3.50 for variable factory overhead) 546,000 Productive capacity at 100% of normal was 90,100 hours, and the factory overhead cost budgeted at the level of 91,000 standard hours was $542,700. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred Budgeted variable factory overhead for 91,000 hours Variance-favorable Fixed factory overhead volume variance: Normal productive capacity at 100% Standard for amount produced Productive capacity not used Standard variable factory overhead rate Variance-unfavorable Variance $315,300 318,500 Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 90,100 hrs. 91,000 900 hrs. x $6.00 5,400 $2,200 Total factory overhead cost variance-unfavorable Compute the following to assist you in identifying the errors in the factory overhead cost variance analysis. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your interim computations to the nearest cent, if required. $(3,200) Amount Favorable/Unfavorable Favorable Favorable Favorable
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