Using the following information Actual direct labor hours used, 4,700 Contracts served 1,500 Standard hours per contract served 3 Budgeted variable overhead per standard DL hour Ph 2 Actual variable overhead incurred Ph 9,500 Required: Compute (1) variable overhead efficiency variance (2) variable overhead spending variance The following information is available from Zyne Company Actual factory overhead Ph 15,000 Fixed overhead expenses, actual 7,200 Fixed overhead expenses, budgeted 7,000 Actual hours 3,500 Standard hours 3,800 Variable overhead rate per DLH Ph 2.50 Assuming that Zyne uses a three-way analysis of overhead variances, compute the spending variance
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.
Using the following information
Actual direct labor hours used, 4,700
Contracts served 1,500
Standard hours per contract served 3
Budgeted variable
Actual variable overhead incurred Ph 9,500
Required: Compute (1) variable overhead efficiency variance
(2) variable overhead spending variance
The following information is available from Zyne Company
Actual factory overhead Ph 15,000
Fixed overhead expenses, actual 7,200
Fixed overhead expenses, budgeted 7,000
Actual hours 3,500
Standard hours 3,800
Variable overhead rate per DLH Ph 2.50
Assuming that Zyne uses a three-way
Step by step
Solved in 2 steps
