The following partial information is contained in the variance analysis received from the Western at Eastlawn apply overhead on the basis of direct labor-hours Flexible budget for variable overhead based on 3,500 direct labor-hours a Actual total overhead incurred Actual direct labor-hours worked Direct labor-hours used to determined the fixed overhead application rate Price variance for variable overhead Price variance for fixed overhead
The following partial information is contained in the variance analysis received from the Western at Eastlawn apply overhead on the basis of direct labor-hours Flexible budget for variable overhead based on 3,500 direct labor-hours a Actual total overhead incurred Actual direct labor-hours worked Direct labor-hours used to determined the fixed overhead application rate Price variance for variable overhead Price variance for fixed overhead
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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.
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Transcribed Image Text:Required A Required B
Prepare a fixed overhead analysis.
Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not
select either option,
Price variance
Production volume variance
Fixed overhead total variance
< Required A
57

Transcribed Image Text:The following partial information is contained in the variance analysis received from the Western Plant of Eastlawn Company. All plants
at Eastlawn apply overhead on the basis of direct labor-hours.
Flexible budget for variable overhead based on 3,500 direct labor-hours.
Actual total overhead incurred
Actual direct labor-hours worked
Direct labor-hours used to determined the fixed overhead application rate
Price variance for variable overhead
Price variance for fixed overhead.
Required:
a. Prepare a variable overhead analysis.
b. Prepare a fixed overhead analysis.
Complete this question by entering your answers in the tabs below.
Required A Required B
$ 98,000
$ 489,300
3,562
3,250
$ 6,450 F
$ 12,514 U
Prepare a fixed overbead analysis.
Note: Indicate the effect of each variance by selecting " for favorable, or "U for unfavorable. If there is no effect, do not
select either option.
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