Cornerstones of Managerial Accounting 6th Edition by Maryanne Mowen,Don Hansen ,Dan Heitger

تمرين 4

Overhead Variances
At the beginning of the year, Lopez Company had the following standard cost sheet for one of its chemical products:

Lopez computes its overhead rates using practical volume, which is 80,000 units. The actual results for the year are as follows: (a) Units produced: 79,600; (b) Direct labor: 158,900 hours at $18.10; (c) FOH : $831,000; and (d) VOH : $112,400.
Required:
1. Compute the variable overhead spending and efficiency variances.
2. Compute the fixed overhead spending and volume variances.