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

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

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
##%!9: ##%!;: ##%8< .=>[email protected] ##%!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 .=>[email protected] ##%!; 4NCA=L=ACDCE>N >H [email protected] >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
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/23/2012 for the course MGMT 201 taught by Professor Rowe during the Spring '08 term at Purdue.

Page1 / 2

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

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online