8-21
(10
15 min.)
4-variance analysis, fill in the blanks.
Variable
Fixed
1.
Spending variance
2.
Efficiency variance
3.
Production-volume variance
4.
Flexible-budget variance
5.
Underallocated (overallocated) MOH
$200 U
2,200 F
NEVER
2,000 F
2,000 F
$4,600 U
NEVER
1,200 F
4,600 U
3,400 U
These relationships could be presented in the same way as in Exhibit 8-4.
Actual Costs
Incurred
(1)
Actual Input
Quantity
× Budgeted Rate
(2)
Flexible Budget:
Budgeted Input
Quantity Allowed
for Actual Output
× Budgeted Rate
(3)
Allocated:
Budgeted Input
Quantity Allowed
for Actual Output
× Budgeted Rate
(4)
Variable
MOH
$31,000
$30,800
$33,000
$33,000
Actual Costs
Incurred
(1)
Same Budgeted
Lump Sum
(as in Static Budget)
Regardless of
Output Level
(2)
Flexible Budget:
Same Budgeted
Lump Sum
(as in Static Budget)
Regardless of
Output Level
(3)
Allocated:
Budgeted Input
Quantity Allowed
for Actual Output
× Budgeted Rate
(4)
Fixed
MOH
$18,000
$13,400
$13,400
$14,600
$200 U
Spending variance
$2,200 F
Efficiency variance
Never a variance
$4,600 U
Spending variance
Never a variance
$1,200 F
Production-volume variance
$2,000 F
Flexible-budget variance
Never a variance
$2,000 F
Overallocated variable overhead
(Total variable overhead variance)
$4,600 U
Flexible-budget variance
$1,200 F
Production-volume variance
$3,400 U
Underallocated fixed overhead
(Total fixed overhead variance)

An overview of the 4 overhead variances is:
4-Variance
Analysis
Spending
Variance
Efficiency
Variance
Production-Volume
Variance