You brought your work home one evening, and your nephew spilled his chocolate milk shake on the variance report you were preparing. Fortunately, knowing that overhead was applied based on machine hours, you were able to reconstruct the obliterated information from the remaining data. Fill in the missing numbers below. Note: Round your per machine hour and per unit answers to two decimal places. Indicate the effect of the variance by selecting "Positive" or "Negative". Select "None" and enter "0" for no effect (i.e., zero variance). Standard Machine hours per unit of output 5 hours Standard Variable-overhead rate per machine hour $9 Actual variable-overhead rate per mchine hours ? Actual machine hours per unit of output ? Budgeted fixed overhead $27,500 Actual fixed overhead ? Budgeted production in units 11,000 Actual production in units ? Variable-overhead spending variance $33,000 Unfavorable Variable-overhead efficiency variance $126,000 Favorable Fixed-overhead budget variance $9,000 Unfavorable Fixed-overhead volume variance ? Total actual overhead $366,500 Total budgeted overhead(flexible budget) ? Total budgeted overhead(static budget) ? Total applied overhead $446,500

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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Question

You brought your work home one evening, and your nephew spilled his chocolate milk shake on the variance report you were preparing. Fortunately, knowing that overhead was applied based on machine hours, you were able to reconstruct the obliterated information from the remaining data. Fill in the missing numbers below.

Note: Round your per machine hour and per unit answers to two decimal places. Indicate the effect of the variance by selecting "Positive" or "Negative". Select "None" and enter "0" for no effect (i.e., zero variance).

Standard Machine hours per unit of output 5 hours

Standard Variable-overhead rate per machine hour $9

Actual variable-overhead rate per mchine hours ?

Actual machine hours per unit of output ?

Budgeted fixed overhead $27,500

Actual fixed overhead ?

Budgeted production in units 11,000

Actual production in units ?

Variable-overhead spending variance $33,000 Unfavorable

Variable-overhead efficiency variance $126,000 Favorable

Fixed-overhead budget variance $9,000 Unfavorable

Fixed-overhead volume variance ?

Total actual overhead $366,500

Total budgeted overhead(flexible budget) ?

Total budgeted overhead(static budget) ?

Total applied overhead $446,500

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

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