201-SELF STUDY PROB-WEEK 14-S'12

201-SELF STUDY PROB-WEEK 14-S'12 -...

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##%!9: ##%!;: ##%8< .=>?@AB ##%!9 EXERCISE 11-26 (20 MINUTES) 1. a. Variable-overhead spending variance = actual variable overhead – (AH ! SVR) = $405,000 – (40,500 ! $9.00) = $40,500 U b. Variable-overhead efficiency variance = SVR(AH – SH) = $9.00(40,500 – 36,000*) = $40,500 U * SH = 36,000 hrs. = 9,000 cases ! 4 hours per case c. Fixed-overhead budget variance = actual fixed OH – budgeted fixed OH = $122,000 – $120,000 = $2,000 U d. Fixed-overhead volume variance = budgeted fixed OH – applied fixed OH = $120,000 – $108,000 = $12,000 (positive)** Applied fixed overhead = ! ! " # $ $ % ' ! ! " # $ $ % hours allowed standard rate overhead fixed ned predetermi = 4) (9,000 4 10,000 $120,000 ! ! " # $ % ' ! = $108,000 **Consistent with the discussion in the text, we choose not to interpret the volume variance as either favorable or unfavorable. Some accountants would designate a positive volume variance as "unfavorable" and a negative volume variance as "favorable." We will use this convention in this class (Mgmt. 201) 2. In the electronic version of the solutions manual, press the CTRL key and click on the following link: Build a Spreadsheet 11-26.xls .=>?@AB ##%!; 4NCA=L=ACDCE>N >H QD=ED?@A >OA=GADJ AHHEKEANKR OD=EDNKA EXERCISE 11-29 (15 MINUTES) Memorandum Date: Today To: I. Makit, Production Supervisor From: I. M. Student, Controller Subject: Variable-overhead efficiency variance The variable-overhead efficiency variance has a misleading name. This variance does not
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201-SELF STUDY PROB-WEEK 14-S'12 -...

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