Lewis Company calculates its predetermined rates using practical volume, which is 288,000 units. The standard cost system allows 2 direct labor hours per unit produced. Overhead is applied using direct labor hours. The total budgeted overhead is P 3,168,000 of which P 864,000 is fixed overhead. The actual results for the year are as follows: Units produced 296,000 Direct labor 570,000 hours @ P 9 Variable overhead P 2,230,000 Fixed overhead P 872,000 Calculate the fixed overhead volume variance a. P 32,000 U b. P 24,000 U c. P 24,000 F d. P 32,000 F
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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