The following data for November have been provided by Hunn Corporation, a producer of precision drills for oil exploration: Budgeted production 5,400 drills Standard machine-hours per drill 10.7 Standard indirect labor $10.50 $4.10 Standard power Actual production Actual machine-hours Actual indirect labor Actual power 5,600 37,050 Indirect labor Power $ 396,570 $ 145,660 machine-hours per machine-hour per machine-hour Variable Overhead Rate Variance drills Required: Compute the variable overhead rate variances for indirect labor and for power for November. Indicate whether each of the variances is favorable (F) or unfavorable (U). machine-hours (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
The following data for November have been provided by Hunn Corporation, a producer of precision drills for oil exploration: Budgeted production 5,400 drills Standard machine-hours per drill 10.7 Standard indirect labor $10.50 $4.10 Standard power Actual production Actual machine-hours Actual indirect labor Actual power 5,600 37,050 Indirect labor Power $ 396,570 $ 145,660 machine-hours per machine-hour per machine-hour Variable Overhead Rate Variance drills Required: Compute the variable overhead rate variances for indirect labor and for power for November. Indicate whether each of the variances is favorable (F) or unfavorable (U). machine-hours (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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.
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Transcribed Image Text:The following data for November have been provided by Hunn Corporation, a producer of precision drills for oil exploration:
Budgeted production
Standard machine-hours per drill 10.7
Standard indirect labor
$ 10.50
$4.10
5,600
37,050
Standard power
Actual production
Actual machine-hours
Actual indirect labor
Actual power
5,400
$ 396,570
$ 145,660
Indirect labor
Power
drills.
machine-hours
Variable Overhead
Rate Variance
per machine-hour
per machine-hour
drills
Required:
Compute the variable overhead rate variances for indirect labor and for power for November. Indicate whether each of the variances is
favorable (F) or unfavorable (U).
machine-hours
(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).
Input all amounts as positive values.)
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