Beluga Corp.has developed standard costs based on a predicted operating level of 352,000 units of production,which is 80% of capacity.Variable overhead is $281,600 at this level of activity,or $0.80 per unit.Fixed overhead is $440,000.The standard costs per unit are:
Beluga actually produced 330,000 units at 75% of capacity and actual costs for the period were:
Calculate the following variances and indicate whether each variance is favorable or unfavorable:

Question

Beluga Corp.has developed standard costs based on a predicted operating level of 352,000 units of production,which is 80% of capacity.Variable overhead is $281,600 at this level of activity,or $0.80 per unit.Fixed overhead is $440,000.The standard costs per unit are:
  Beluga actually produced 330,000 units at 75% of capacity and actual costs for the period were:
  Calculate the following variances and indicate whether each variance is favorable or unfavorable:

Quizplus · Accepted Answer

The Answer of Beluga Corp.has developed standard costs based on a predicted operating level of 352,000 units of production,which is 80% of capacity.Variable overhead is $281,600 at this level of activity,or $0.80 per unit.Fixed overhead is $440,000.The standard costs per unit are:
  Beluga actually produced 330,000 units at 75% of capacity and actual costs for the period were:
  Calculate the following variances and indicate whether each variance is favorable or unfavorable: