Flexible Overhead Budget Wiki Wiki Company has determined that the variable overhead rate is $4.50 per direct labor hour in the Fabrication Department. The normal production capacity for the Fabrication Department is 10,000 hours for the month. Fixed costs are budgeted at $60,000 for the month. a. Prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. Enter all amounts as positive numbers. Wiki Wiki Company Monthly Factory Overhead Cost Budget-Fabrication Department Direct labor hours 9,000 10,000 11,000 Variable factory overhead cost $fill in the blank 06d288060fcc037_1 $fill in the blank 06d288060fcc037_2 $fill in the blank 06d288060fcc037_3 Fixed factory overhead cost fill in the blank 06d288060fcc037_4 fill in the blank 06d288060fcc037_5 fill in the blank 06d288060fcc037_6 Total factory overhead cost $fill in the blank 06d288060fcc037_7 $fill in the blank 06d288060fcc037_8 $fill in the blank 06d288060fcc037_9 b. How much overhead would be applied to production if 9,000 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar. $fill in the blank b68973f7703b025_1
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.
Flexible
Wiki Wiki Company has determined that the variable overhead rate is $4.50 per direct labor hour in the Fabrication Department. The normal production capacity for the Fabrication Department is 10,000 hours for the month. Fixed costs are budgeted at $60,000 for the month.
a. Prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. Enter all amounts as positive numbers.
| Wiki Wiki Company | |||
| Monthly |
|||
| Direct labor hours | 9,000 | 10,000 | 11,000 |
| Variable factory overhead cost | $fill in the blank 06d288060fcc037_1 | $fill in the blank 06d288060fcc037_2 | $fill in the blank 06d288060fcc037_3 |
| Fixed factory overhead cost | fill in the blank 06d288060fcc037_4 | fill in the blank 06d288060fcc037_5 | fill in the blank 06d288060fcc037_6 |
| Total factory overhead cost | $fill in the blank 06d288060fcc037_7 | $fill in the blank 06d288060fcc037_8 | $fill in the blank 06d288060fcc037_9 |
b. How much overhead would be applied to production if 9,000 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar.
$fill in the blank b68973f7703b025_1
A flexible budget is a budget that includes all the flexibility and change in the output. In comparison to the Static budget, the flexible budget is more useful. It includes Fixed and variable both.
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