Exam 14: Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Dixie Corporation has provided the following data for June. Required: a. Compute the budget variance for June. Show your work! b. Compute the volume variance for June. Show your work!

The Murray Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours (DLHs). The company recorded the following activity and cost data for May: The amount of fixed manufacturing overhead cost that was used to compute the fixed component of the predetermined overhead rate was:

The Dillon Corporation makes and sells a single product. Overhead costs are applied on the basis of standard direct labor-hours. The standard cost card shows that 5 direct labor-hours are required per unit. The Dillon Corporation had the following budgeted and actual data for March: The fixed manufacturing overhead budget variance for March is:

At the beginning of last year, Tari Corporation budgeted $300,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Tari's fixed manufacturing overhead budget variance was $9,000 favorable. Its fixed manufacturing overhead volume variance was $15,000 favorable. Actual direct labor-hours for the year were 625,000. What was Tari's total standard machine-hours allowed for last year's output?

Odonell Corporation estimates that its variable manufacturing overhead is $11.20 per machine-hour and its fixed manufacturing overhead is $563,640 per period. If the denominator level of activity is 6,000 machine-hours, the variable component in the predetermined overhead rate would be:

A company has a standard cost system in which fixed and variable manufacturing overhead costs are applied to products on the basis of direct labor-hours. A fixed manufacturing overhead volume variance will NOT necessarily occur in a month in which production volume differs from sales volume.

In a standard costing system where the denominator activity for the predetermined overhead rate is labor-hours, overhead costs are applied to work in process on the basis of the standard labor-hours allowed for the actual output.

An outdoor barbecue grill manufacturer has a standard costing system based on standard direct labor-hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead volume variance for the period is closest to:

The fixed manufacturing overhead volume variance is more meaningful than the budget variance for cost control purposes.

Traveller Corporation sells one product and uses a standard cost system. Last year the overhead volume variance was zero. Which of the following is correct?

Omary Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs). The company has provided the following data for the most recent month: What was the total of the variable overhead rate and fixed manufacturing overhead budget variances for the month?

The Murray Corporation makes and sells a single product. The company recorded the following activity and cost data for May: The fixed component of the predetermined overhead rate is $0.95 per direct labor-hour. The fixed manufacturing overhead used to calculate the predetermined overhead rate was:

The Murray Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours (DLHs). The company recorded the following activity and cost data for May: The amount of fixed manufacturing overhead cost applied during May was:

Reidenbach Corporation applies manufacturing overhead to products on the basis of standard machine-hours. The budgeted fixed manufacturing overhead cost for the most recent month was $17,100 and the actual fixed manufacturing overhead cost for the month was $17,450. The company based its original budget on 4,500 machine-hours. The standard hours allowed for the actual output of the month totaled 4,810 machine-hours. What was the overall fixed manufacturing overhead budget variance for the month?

Derf Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours. Two direct labor-hours are required for each unit produced. The denominator activity was set at 9,000 units. Manufacturing overhead was budgeted at $135,000 for the period; 20 percent of this cost was fixed. The 17,200 hours worked during the period resulted in production of 8,500 units. Variable manufacturing overhead cost incurred was $108,500 and fixed manufacturing overhead cost was $28,000. The variable overhead rate variance for the period was:

The Forbes Corporation uses a standard cost system in which overhead costs are applied to products on the basis of standard direct labor-hours (DLHs). The following data applied to the company's activities for June: The volume variance for June is:

A manufacturing company uses a standard costing system in which standard machine-hours (MHs) is the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The overhead applied to products during the period was closest to:

Aslett Corporation's manufacturing overhead includes $3.80 per machine-hour for supplies; $8.80 per machine-hour for indirect labor; $214,132 per period for salaries; and $546,720 per period for depreciation. Required: Determine the predetermined overhead rate if the denominator level of activity is 6,800 machine-hours. Show your work!

A manufacturing company uses a standard costing system in which standard machine-hours (MHs) is the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The variable overhead rate variance for the period was closest to:

Hairr Corporation bases its predetermined overhead rate on variable manufacturing overhead cost of $9.50 per machine-hour and fixed manufacturing overhead cost of $947,672 per period. If the denominator level of activity is 8,900 machine-hours, the predetermined overhead rate would be: