Montgomery Company has developed the following flexible budget formulas for its four overhead items:

Montgomery normally produces 15,000 units (each unit requires 0.30 direct labor hours); however, this year 19,000 units were produced with the following actual costs:

- Using an after-the-fact flexible budget, calculate the variance for power.

Question

Montgomery Company has developed the following flexible budget formulas for its four overhead items: 
  
Montgomery normally produces 15,000 units (each unit requires 0.30 direct labor hours); however, this year 19,000 units were produced with the following actual costs:

-  Using an after-the-fact flexible budget, calculate the variance for power.

Quizplus · Accepted Answer

Variance = $2,200 - [$1,500 + ($0.30 × 5,700)] = $1,010 F

Montgomery Company Has Developed the Following Flexible Budget Formulas for Its