Managerial Accounting-Question 23-3Bcan you assist with how i obtain the amounts in the attached sheet from this problem. this is section C of the question already answered. **Factory Overhead Cost Variance****Variable factory overhead controllable variance:**- **Actual variable FO cost incurred:** $8,200 - **Budgeted variable FO cost for 2,080 hours:** $8,320 - **Variance:** $120 (favorable)**Fixed factory overhead volume variance:**- **Hours at normal capacity:** 2,000 - **Standard hours for amount produced:** [Blank] - **Productive capacity not used:** [Blank] - **Standard fixed FO cost rate:** [Blank] - **Variance:** [Blank] **Total factory overhead cost variance:** [Blank] ---**Explanation:**1. **Variable Factory Overhead Controllable Variance:** - Compares actual costs to budgeted costs. - A variance of $120 is considered favorable, indicating savings.2. **Fixed Factory Overhead Volume Variance:** - Involves comparison of hours at normal capacity versus standard hours for production. - Key components such as capacity not used and standard fixed cost rate are missing/blank, affecting variance calculation.3. **Total Factory Overhead Cost Variance:** - Represents the sum of variable and fixed overhead variances. - Requires completion of missing data for accurate calculation. **Chapter 23, Problem 3PB****Textbook Problem****Direct materials, direct labor, and factory overhead cost variance analysis**Road Gripper Tire Co. manufactures automobile tires. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 4,160 tires were as follows:| | Standard Costs | Actual Costs ||----------------------|----------------------------------------|--------------------------------------|| **Direct materials** | 100,000 lbs. at $6.40 | 101,000 lbs. at $6.50 || **Direct labor** | 2,080 hrs. at $15.75 | 2,000 hrs. at $15.40 || **Factory overhead** | Rates per direct labor hr., | || | based on 100% of normal | || | capacity of 2,000 direct | || | labor hrs.: | || | Variable cost, $4.00 | $8,200 variable cost || | Fixed cost, $6.00 | $12,000 fixed cost |This table outlines the variances between standard and actual costs for key production factors. - **Direct Materials**: There was an increase in both the cost per pound and the total pounds used. - **Direct Labor**: There was a reduction in both the hours worked and the rate per hour.- **Factory Overhead**: Compares variable and fixed costs relative to standard rates per hour based on normal capacity. The analysis helps identify areas of cost variance, which is crucial for budgeting and financial planning within the manufacturing process.

Variable factory overhead controllable variance: Actual variable FO cost incurred 8,200 Budgeted variable FO cost for 2,080 hrs. 8,320 Variance (120) favorable Fixed factory overhead volume variance: Hours at normal capacity 2,000 Standard hours for amount produced Productive capacity not used Standard fixed FO cost rate Variance Total factory overhead cost variance %3D

Variable factory overhead controllable variance: Actual variable FO cost incurred 8,200 Budgeted variable FO cost for 2,080 hrs. 8,320 Variance (120) favorable Fixed factory overhead volume variance: Hours at normal capacity 2,000 Standard hours for amount produced Productive capacity not used Standard fixed FO cost rate Variance Total factory overhead cost variance %3D

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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