Objective: 6AACSB: Analytical skillsAnswer the following questions using the information below: Munoz, Inc., produces a special line of plastic toy racing cars. Munoz, Inc., produces the cars in batches. To manufacture a batch of the cars, Munoz, Inc., must set up the machines and molds. Setup costs are batch-level costs because they are associated with batches rather than individual units of products. A separate Setup Department is responsible for setting up machines and molds for different styles of car.Setup overhead costs consist of some costs that are variable and some costs that are fixed with respect to the number of setup-hours. The following information pertains to June 2004:ActualStatic-budgetAmountsAmountsUnits produced and sold15,00011,250Batch size (number of units per batch)250225Setup-hours per batch55.25Variable overhead cost per setup-hour$40$38Total fixed setup overhead costs$14,400$14,000139) Calculate the efficiency variance for variable setup overhead costs.
Diff: 3Terms: variable overhead efficiency varianceObjective: 7AACSB: Analytical skills140) Calculate the spending variance for variable setup overhead costs.
Diff: 3Terms: variable overhead spending varianceObjective: 7AACSB: Analytical skills141) Calculate the flexible-budget variance for variable setup overhead costs. A) $600 favorable