Wings Co. budgeted $573,000 manufacturing direct wages, 3,000 direct labor hours, and had the following manufacturing overhead: Overhead Cost Pool Budgeted Overhead Cost Budgeted Level for Cost Driver Overhead Cost Driver Materials handling $ 200,000 5,000 pounds Weight of materials Machine setup 17,100 570 setups Number of setups Machine repair 1,590 31,800 machine hours Machine hours Inspections 13,600 340 inspections Number of inspections Requirements for Job #971 which manufactured 4 units of product: Direct labor 25 hours Direct materials 310 pounds Machine setup 40 setups Machine hours 16,800 machine hours Inspections 20 inspections If Wings uses a volume-based overhead rate based on direct labor hours, the manufacturing overhead for Job #971 is:
Wings Co. budgeted $573,000 manufacturing direct wages, 3,000 direct labor hours, and had the following manufacturing overhead: Overhead Cost Pool Budgeted Overhead Cost Budgeted Level for Cost Driver Overhead Cost Driver Materials handling $ 200,000 5,000 pounds Weight of materials Machine setup 17,100 570 setups Number of setups Machine repair 1,590 31,800 machine hours Machine hours Inspections 13,600 340 inspections Number of inspections Requirements for Job #971 which manufactured 4 units of product: Direct labor 25 hours Direct materials 310 pounds Machine setup 40 setups Machine hours 16,800 machine hours Inspections 20 inspections If Wings uses a volume-based overhead rate based on direct labor hours, the manufacturing overhead for Job #971 is:
Chapter1: Financial Statements And Business Decisions
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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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Wings Co. budgeted $573,000 manufacturing direct wages, 3,000 direct labor hours, and had the following manufacturing overhead : Overhead Cost Pool Budgeted Overhead Cost Budgeted Level for Cost Driver Overhead Cost Driver Materials handling $ 200,000 5,000 pounds Weight of materials Machine setup 17,100 570 setups Number of setups Machine repair 1,590 31,800 machine hours Machine hours Inspections 13,600 340 inspections Number of inspections Requirements for Job #971 which manufactured 4 units of product: Direct labor 25 hours Direct materials 310 pounds Machine setup 40 setups Machine hours 16,800 machine hours Inspections 20 inspections If Wings uses a volume-based overhead rate based on direct labor hours, the manufacturing overhead for Job #971 is:
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