Standish Company manufactures consumer products and provided the following information for the month of February: Units produced 131,900 Standard direct labor hours per unit Standard fixed overhead rate (per direct labor hour) Budgeted fixed overhead Actual fixed overhead costs Actual hours worked Required: 0.2 $2.30 $65,000 $68,600 26,750
Standish Company manufactures consumer products and provided the following information for the month of February: Units produced 131,900 Standard direct labor hours per unit Standard fixed overhead rate (per direct labor hour) Budgeted fixed overhead Actual fixed overhead costs Actual hours worked Required: 0.2 $2.30 $65,000 $68,600 26,750
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 58E: At the beginning of the year, Lopez Company had the following standard cost sheet for one of its...
Related questions
Concept explainers
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.
Topic Video
Question
Please do not give solution in image format thanku
![Standish Company manufactures consumer products and provided the following information for the month of February:
Units produced
131,900
Standard direct labor hours per unit
0.2
Standard fixed overhead rate (per direct labor hour)
$2.30
Budgeted fixed overhead
$65,000
Actual fixed overhead costs
$68,600
Actual hours worked
26,750
Required:
1. Calculate the fixed overhead spending variance using the formula approach.
Unfavorable ✓
2. Calculate the volume variance using the formula approach.
Unfavorable ✓
3. What if 127,700 units had actually been produced in February? What impact would that have had? Indicate what the new variances would be below.
Fixed Overhead Spending Variance
Unfavorable ✓
Volume Variance
Unfavorable ✓
6,258 X](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe15b8af0-27e1-4c12-b293-7f8d2f41b828%2Face08d1e-b0a4-4ef6-8e0b-4427b19f88ee%2Frhkkbw_processed.png&w=3840&q=75)
Transcribed Image Text:Standish Company manufactures consumer products and provided the following information for the month of February:
Units produced
131,900
Standard direct labor hours per unit
0.2
Standard fixed overhead rate (per direct labor hour)
$2.30
Budgeted fixed overhead
$65,000
Actual fixed overhead costs
$68,600
Actual hours worked
26,750
Required:
1. Calculate the fixed overhead spending variance using the formula approach.
Unfavorable ✓
2. Calculate the volume variance using the formula approach.
Unfavorable ✓
3. What if 127,700 units had actually been produced in February? What impact would that have had? Indicate what the new variances would be below.
Fixed Overhead Spending Variance
Unfavorable ✓
Volume Variance
Unfavorable ✓
6,258 X
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
![Financial And Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337902663/9781337902663_smallCoverImage.jpg)
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,