Algood Incorporated Is Trying to Decide Which Method of Analyzing

Essay

Algood Incorporated is trying to decide which method of analyzing its overhead variances provides the most useful information.The following information is available from the records for April: $\begin{array}{|l|r|}\hline \text { Budgeted units of output } & 4,000 \text { tor April } \\\hline \text { Budgeted fixed ouerhead } & \$ 27,000 \text { month } \\\hline \text { Budgeted variable overhead } & \$ 6 / D L H \\\hline \text { Budgeted direct labor hours } & 3 \text { hoursiunit } \\\hline \text { Fixed owerhead incurred } & \$ 26,600 \\\hline \text { Direct labor hours used } & 12,000 \\\hline \text { Variable overhead incurred } & \$ 71,500 \\\hline \text { Actual units produced } & 4,200 \\\hline\end{array}$

Required:
Compute the overhead variances using the following approaches;
(1)Four-way analysis
(2)Three-way analysis
(3)Two-way analysis