The management of Cleancut Lawnmowers has calculated the following variances: $$\begin{array} { | l | r | }
\hline \text { Direct materials cost variance } & \$ 8000 \mathrm { U } \
\hline \text { Direct materials efficiency variance } & 38,000 \mathrm {~F} \
\hline \text { Direct labor cost variance } & 17,000 \mathrm {~F} \
\hline \text { Direct labor efficiency variance } & 13,000 \mathrm { U } \
\hline \text { Variable overhead cost variance } & 3500 \mathrm {~F} \
\hline \text { Variable overhead efficiency variance } & 5000 \mathrm {~F} \
\hline \text { Fixed overhead cost variance } & 3000 \mathrm {~F} \
\hline
\end{array}$$ When determining the total product cost flexible budget variance,what is the total manufacturing overhead variance of the company?

Question

The management of Cleancut Lawnmowers has calculated the following variances: $$\begin{array} { | l | r | } 
\hline \text { Direct materials cost variance } & \$ 8000 \mathrm { U } \
\hline \text { Direct materials efficiency variance } & 38,000 \mathrm {~F} \
\hline \text { Direct labor cost variance } & 17,000 \mathrm {~F} \
\hline \text { Direct labor efficiency variance } & 13,000 \mathrm { U } \
\hline \text { Variable overhead cost variance } & 3500 \mathrm {~F} \
\hline \text { Variable overhead efficiency variance } & 5000 \mathrm {~F} \
\hline \text { Fixed overhead cost variance } & 3000 \mathrm {~F} \
\hline
\end{array}$$ When determining the total product cost flexible budget variance,what is the total manufacturing overhead variance of the company?

Quizplus · Accepted Answer

The total manufacturing overhead variance is the sum of the variable overhead cost variance and the fixed overhead cost variance. The variable overhead cost variance is $3500 F and the fixed overhead cost variance is $3000 F. Therefore, the total manufacturing overhead variance is $3500 F + $3000 F = $11,500 F.

The Management of Cleancut Lawnmowers Has Calculated the Following Variances