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Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 100,000 units of product are as follows: Actual: Variable factory overhead Fixed factory overhead 494,000 Standard: 132,000 hrs. at $7.30 ($3.50 for variable factory overhead) 963,600 Productive capacity at 100% of normal was 130,000 hours, and the factory overhead cost budgeted at the level of 132,000 standard hours was $956,000. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred $458,000 Budgeted variable factory overhead for 132,000 hours 462,000 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 130,000 Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 132,000 2,000 x $7.30 $458,000 hrs. 14,600 Total factory overhead cost variance-unfavorable $10,600 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. $ $ $ hrs. Amount -$ 4,000 Favorable/Unfavorable

Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 100,000 units of product are as follows: Actual: Variable factory overhead Fixed factory overhead 494,000 Standard: 132,000 hrs. at $7.30 ($3.50 for variable factory overhead) 963,600 Productive capacity at 100% of normal was 130,000 hours, and the factory overhead cost budgeted at the level of 132,000 standard hours was $956,000. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred $458,000 Budgeted variable factory overhead for 132,000 hours 462,000 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 130,000 Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 132,000 2,000 x $7.30 $458,000 hrs. 14,600 Total factory overhead cost variance-unfavorable $10,600 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. $ $ $ hrs. Amount -$ 4,000 Favorable/Unfavorable

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 100,000 units of product are as follows: Actual: Variable factory overhead Fixed factory overhead Standard: 132,000 hrs. at $7.30 ($3.50 for variable factory overhead) Productive capacity at 100% of normal was 130,000 hours, and the factory overhead cost budgeted at the level of 132,000 standard hours was $956,000. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred $458,000 Budgeted variable factory overhead for 132,000 hours 462,000 Variance favorable Variance Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 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 Total factory overhead cost variance-unfavorable $10,600 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. 130,000 132,000 2,000 x $7.30 $458,000 494,000 963,600 $ $ $ hrs. hrs. Amount -$ 4,000 14,600 Favorable/Unfavorable
Transcribed Image Text:Factory Overhead Variance Corrections The data related to Shunda Enterprises Inc.'s factory overhead cost for the production of 100,000 units of product are as follows: Actual: Variable factory overhead Fixed factory overhead Standard: 132,000 hrs. at $7.30 ($3.50 for variable factory overhead) Productive capacity at 100% of normal was 130,000 hours, and the factory overhead cost budgeted at the level of 132,000 standard hours was $956,000. Based on these data, the chief cost accountant prepared the following variance analysis: Variable factory overhead controllable variance: Actual variable factory overhead cost incurred $458,000 Budgeted variable factory overhead for 132,000 hours 462,000 Variance favorable Variance Variable Factory Overhead Controllable Variance Fixed Factory Overhead Volume Variance Total Factory Overhead Cost Variance 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 Total factory overhead cost variance-unfavorable $10,600 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. 130,000 132,000 2,000 x $7.30 $458,000 494,000 963,600 $ $ $ hrs. hrs. Amount -$ 4,000 14,600 Favorable/Unfavorable
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