The Finishing Department of Pinnacle Manufacturing Co. prepared the following factory overhead cost budget for October of the current year, during which it expected to operate at a 100% capacity of 10,000 machine hours. Variable costs: Indirect factory wages $18,000 Power and light 12,000 Indirect materials 4,000 Total variable cost $34,000 Fixed costs: Supervisory salaries $12,000 Depreciation of plant and equipment 8,800 Insurance and property taxes 3,200 Total fixed cost 24,000 Total factory overhead $58,000 During October, the plant was operated for 9,000 machine hours and the factory overhead costs incurred were as follows: indirect factory wages, $16,400; power and light, $10,000; indirect materials, $3,000; supervisory salaries, $12,000; depreciation of plant and equipment, $8,800; insurance and property taxes, $3,200. Prepare a factory overhead cost variance report for October. (The budgeted amounts for actual amount produced should be based on 9,000 machine hours.) Enter all amounts as positive numbers. If an amount box does not require an entry, leave it blank. Pinnacle Manufacturing Co.-Finishing Department Factory Overhead Cost Variance Report For the Month Ended October 31 Productive capacity for the month hours Actual production for the month hours
The Finishing Department of Pinnacle Manufacturing Co. prepared the following factory overhead cost budget for October of the current year, during which it expected to operate at a 100% capacity of 10,000 machine hours. Variable costs: Indirect factory wages $18,000 Power and light 12,000 Indirect materials 4,000 Total variable cost $34,000 Fixed costs: Supervisory salaries $12,000 Depreciation of plant and equipment 8,800 Insurance and property taxes 3,200 Total fixed cost 24,000 Total factory overhead $58,000 During October, the plant was operated for 9,000 machine hours and the factory overhead costs incurred were as follows: indirect factory wages, $16,400; power and light, $10,000; indirect materials, $3,000; supervisory salaries, $12,000; depreciation of plant and equipment, $8,800; insurance and property taxes, $3,200. Prepare a factory overhead cost variance report for October. (The budgeted amounts for actual amount produced should be based on 9,000 machine hours.) Enter all amounts as positive numbers. If an amount box does not require an entry, leave it blank. Pinnacle Manufacturing Co.-Finishing Department Factory Overhead Cost Variance Report For the Month Ended October 31 Productive capacity for the month hours Actual production for the month hours
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:The Finishing Department of Pinnacle Manufacturing Co. prepared the following factory overhead cost budget for October of the current year, during which it expected to operate at a 100% capacity of 10,000 machine
hours.
Variable costs:
Indirect factory wages
$18,000
Power and light
12,000
Indirect materials
4,000
Total variable cost
$34,000
Fixed costs:
Supervisory salaries
$12,000
Depreciation of plant and equipment
8,800
Insurance and property taxes
3,200
Total fixed cost
24,000
Total factory overhead
$58,000
During October, the plant was operated for 9,000 machine hours and the factory overhead costs incurred were as follows: indirect factory wages, $16,400; power and light, $10,000; indirect materials, $3,000;
supervisory salaries, $12,000; depreciation of plant and equipment, $8,800; insurance and property taxes, $3,200.
Prepare a factory overhead cost variance report for October. (The budgeted amounts for actual amount produced should be based on 9,000 machine hours.) Enter all amounts as positive numbers. If an amount box
does not require an entry, leave it blank.
Pinnacle Manufacturing Co.-Finishing Department
Factory Overhead Cost Variance Report
For the Month Ended October 31
Productive capacity for the month
hours
Actual production for the month
hours
Transcribed Image Text:Pinnacle Manufacturing Co.-Finishing Department
Factory Overhead Cost Variance Report
For the Month Ended October 31
Productive capacity for the month
hours
Actual production for the month
hours
Budget
Actual
Favorable Variances
Unfavorable Variances
Variable factory overhead costs:
Indirect factory wages
Power and light
Indirect materials
Total variable factory overhead cost
Fixed factory overhead costs:
Supervisory salaries
Depreciation of plant and equipment
Insurance and property taxes
Total fixed factory overhead cost
Total factory overhead cost
Total controllable variances
$
Net controllable
Net controllable variance-favorable
Volume variance-unfavorable:
Idle hours at the standard rate for fixed overhead
Total factory overhead cost variance-unfavorable
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