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Wharton Tooling uses a standard cost system to account for the costs of its one product Standard labor input is 14 hours per unit. Th standard variable overhead rate is $9.00 per direct labor hour, and fixed overhead is budgeted at $150 per unit, based on budgeted production of 650 units. During July, Wharton Tooling produced 600 units. Payroll totaled $112,930 for 8,770 hours worked. Overhe incurred was $78,053 variable and $98,750 fixed. Required: a. Calculate the variable overhead rate variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the variable overhead efficiency variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). c. Calculate the fixed overhead spending variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Rate Variance b. Efficiency Variance c. Spending Variance

Wharton Tooling uses a standard cost system to account for the costs of its one product Standard labor input is 14 hours per unit. Th standard variable overhead rate is $9.00 per direct labor hour, and fixed overhead is budgeted at $150 per unit, based on budgeted production of 650 units. During July, Wharton Tooling produced 600 units. Payroll totaled $112,930 for 8,770 hours worked. Overhe incurred was $78,053 variable and $98,750 fixed. Required: a. Calculate the variable overhead rate variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the variable overhead efficiency variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). c. Calculate the fixed overhead spending variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Rate Variance b. Efficiency Variance c. Spending Variance

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Wharton Tooling uses a standard cost system to account for the costs of its one product Standard labor input is 14 hours per unit. The standard variable overhead rate is $9.00 per direct labor hour, and fixed overhead is budgeted at $150 per unit, based on budgeted production of 650 units. During July, Wharton Tooling produced 600 units. Payroll totaled $112,930 for 8,770 hours worked. Overhead incurred was $78,053 variable and $98,750 fixed. Required: a. Calculate the variable overhead rate variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the variable overhead efficiency variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). c. Calculate the fixed overhead spending variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Rate Variance b. Efficiency Variance c. Spending Variance
Transcribed Image Text:Wharton Tooling uses a standard cost system to account for the costs of its one product Standard labor input is 14 hours per unit. The standard variable overhead rate is $9.00 per direct labor hour, and fixed overhead is budgeted at $150 per unit, based on budgeted production of 650 units. During July, Wharton Tooling produced 600 units. Payroll totaled $112,930 for 8,770 hours worked. Overhead incurred was $78,053 variable and $98,750 fixed. Required: a. Calculate the variable overhead rate variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the variable overhead efficiency variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). c. Calculate the fixed overhead spending variance. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Rate Variance b. Efficiency Variance c. Spending Variance
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