Nova Tools Co. produces a single product. The following standard costs apply tovariable overhead:•Standard hours per unit: 5.0 hoursStandard variable overhead rate: $12 per hourLast month's actual results:• Actual hours worked: 8,400 hours• Actual total variable overhead cost: $100,800Actual output: 1,700 unitsA. What is the variable overhead rate variance for the month?B. What is the variable overhead efficiency variance for the month?

Step 1: DefinitionsVariable Overhead Rate Variance measures the difference between the actual…

Answered: Nova Tools Co. produces a single…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 10EA: ThingOne Company has the following information available for the past year. They use machine hours...

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At the beginning of the year, Lopez Company had the following standard cost sheet for one of its chemical products: Lopez computes its overhead rates using practical volume, which is 80,000 units. The actual results for the year are as follows: (a) Units produced: 79,600; (b) Direct labor: 158,900 hours at 18.10; (c) FOH: 831,000; and (d) VOH: 112,400. Required: 1. Compute the variable overhead spending and efficiency variances. 2. Compute the fixed overhead spending and volume variances.
Reddy Corporation has collected the following data for the month or June: What is the variable overhead efficiency variance?
A manufacturer planned to use $78 of variable overhead per unit produced, but in the most recent period, it actually used $76 of variable overhead per unit produced. During this same period, the company planned to produce 500 units but actually produced 540 units. What is the variable overhead spending variance?
Breakaway Companys labor information for May is as follows: A. What is the actual direct labor rate per hour? B. What is the standard direct labor rate per hour? C. What was the total standard direct labor cost for May? D. What was the direct labor rate variance for May?
Baxter Company has a relevant range of production between 15,000 and 30,000 units. The following cost data represents average variable costs per unit for 25,000 units of production. Using the costs data from Rose Company, answer the following questions: A. If 15,000 units are produced, what is the variable cost per unit? B. If 28,000 units are produced, what is the variable cost per unit? C. If 21,000 units are produced, what are the total variable costs? D. If 29,000 units are produced, what are the total variable costs? E. If 17,000 units are produced, what are the total manufacturing overhead costs incurred? F. If 23,000 units are produced, what are the total manufacturing overhead costs incurred? G. If 30,000 units are produced, what are the per unit manufacturing overhead costs incurred? H. If 15,000 units are produced, what are the per unit manufacturing overhead costs incurred?
At the end of the period, the factory overhead account has a credit balance of 10,000. (a) Is the total factory cost variance favorable or unfavorable? (b) Are the controllable and volume variances favorable or unfavorable?
Fitzgerald Company manufactures sewing machines, and they produced 2,500 this past month. The standard variable manufacturing overhead (M0H) rate used by the company is $6.75 per machine hour. Each sewing machine requires 13.5 machine hours. Actual machine hours used last month were 33,500, and the actual variable MOH rate last month was $7.00. Calculate the variable overhead rate variance and the variable overhead efficiency variance.
Grand Canyon Manufacturing Inc. produces and sells a product with a price of 100 per unit. The following cost data have been prepared for its estimated upper and lower limits of activity: Overhead: Selling and administrative expenses: Required: 1. Classify each cost element as either variable, fixed, or semi-variable. (Hint: Recall that variable expenses must go up in direct proportion to changes in the volume of activity.) 2. Calculate the break-even point in units and dollars. (Hint: First use the high-low method illustrated in Chapter 4 to separate costs into their fixed and variable components.) 3. Prepare a break-even chart. 4. Prepare a contribution income statement, similar in format to the statement appearing on page 540, assuming sales of 5,000 units. 5. Recompute the break-even point in units, assuming that variable costs increase by 20% and fixed costs are reduced by 50,000.
Rose Company has a relevant range of production between 10,000 and 25.000 units. The following cost data represents average cost per unit for 15,000 units of production. Using the cost data from Rose Company, answer the following questions: If 10,000 units are produced, what is the variable cost per unit? If 18,000 units are produced, what is the variable cost per unit? If 21,000 units are produced, what are the total variable costs? If 11,000 units are produced, what are the total variable costs? If 19,000 units are produced, what are the total manufacturing overhead costs incurred? If 23,000 units are produced, what are the total manufacturing overhead costs incurred? If 19,000 units are produced, what are the per unit manufacturing overhead costs incurred? If 25,000 units are produced, what are the per unit manufacturing overhead costs incurred?
A company sets the following standards for its variable overhead: • Standard hours per unit: 5.0 hours Standard variable overhead rate: $12 per hour Last month's data: • Actual hours worked: 11,500 hours . Actual variable overhead cost: $134,800 • Actual production: 2,200 units A. What is the variable overhead rate variance? B. What is the variable overhead efficiency variance?
Can you explain this general accounting question using accurate calculation methods?
General Accounting

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