Managerial Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (5th Edition)

5th Edition

ISBN: 9780134642093

Author: Karen W. Braun, Wendy M. Tietz

Publisher: PEARSON

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Textbook Question

Chapter 11, Problem 11.9SE

Calculate fixed overhead variances (Learning Objective 6)

Boxer Manufacturing produces luxury dog houses. Each dog house requires 4.0 hours of machine time for its elaborate trim and finishing. For the current year, Boxer calculated its predetermined fixed manufacturing overhead (MOH) rate to be $26 per machine hour. The company budgets its fixed MOH to be $202,000 per month. Last month. Boxer produced 2,000 dog houses and incurred $198,400 (actual) of fixed MOH.

Requirements

1. Calculate the fixed overhead budget variance.
2. Calculate the fixed overhead volume variance.

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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Chapter 11, Problem 11.8SE

Chapter 11, Problem 11.10SE

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Chapter 11 Solutions

Managerial Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (5th Edition)

Ch. 11 - (Learning Objective 1) Which of the following is...Ch. 11 - (Learning Objective 2) The direct material price...Ch. 11 - Prob. 3QC Ch. 11 - Prob. 4QC Ch. 11 - Prob. 5QC Ch. 11 - (Learning Objective 4) Which of the following is...Ch. 11 - Prob. 7QC Ch. 11 - (Learning Objective 6) Which of the following is...Ch. 11 - Prob. 9QC Ch. 11 - (Learning Objective 7Appendix) Which of the...

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Solution Summary: The author calculates the fixed overhead budget variance, which is the difference between the budgeted and the standard fix overhead cost allocated to production.

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