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 3,630 direct labor-hours Actual total overhead incurred Actual direct labor-hours worked i 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 $ 101,640 $ 500,000 Price variance Efficiency variance 3,757 3,380 $ 7,100 F $ 11,864 U Prepare a variable 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.
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 3,630 direct labor-hours Actual total overhead incurred Actual direct labor-hours worked i 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 $ 101,640 $ 500,000 Price variance Efficiency variance 3,757 3,380 $ 7,100 F $ 11,864 U Prepare a variable 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.
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: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 3,630 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.
Price variance
Efficiency variance
Prepare a variable 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.
2
$ 101,640
$ 500,000
www
3,757
3,380
$ 7,100 F
$ 11,864 U
Transcribed Image Text:b. Prepare a fixed overhead analysis.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Prepare a variable 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
Efficiency variance
Variable overhead total variance
a. Prepare a variable overhead analysis.
b. Prepare a fixed overhead analysis.
Required A Required B
U
Required
Complete this question by entering your answers in the tabs below.
Price variance
Production volume variance
Fixed overhead total variance
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.
<Required A
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Step 1: Defining Variable overhead Variance
VIEWStep 2: Solution to Requirement a:
VIEWStep 3: Continuation to requirement a :
VIEWStep 4: Solution to requirement b:
VIEWStep 5: Calculating Budgeted Fixed overhead and Fixed overhead application rate :
VIEWStep 6: Calculating Fixed overhead production volume variance and Fixed overhead total variance
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