Lamp light limited ( LLL) in E9-11 calculates a fixed overhead rate based on byd
ID: 2456865 • Letter: L
Question
Lamp light limited ( LLL) in E9-11 calculates a fixed overhead rate based on bydgeted fixed overhead of 32,000 and budgeted production of 24,000 units, Actual results are as follows
E9-11
Variable manufacturing overhead
Standard quantity- 0.6.
Standard Rate- $ 0.80
Standard unit cost- $ 0.48
Required
Calculates the following LLL
1. Fed overhead rate based on budgeted production
2. Fixed overhead spending variance
3. fixed overhead volume variance
4.over or underapplied fixed overhead
Unit produced and sold 25,000 Actual variable overhead $ 9,490 Actual direct labor 16,000Explanation / Answer
Fixed overheads rate based on budgeted production : Budgeted FOH/ Budgeted production
32,000/24,000 = 1.33
Fixed overhead spending variance : Actual overheads - Budgeted overheads
32,000 - 32,0000 = NIL
Fixed overheads volume variance: Absorbed fixed overheads - Budgeted Fixed overheads
(25,000 *1.333) - 24,0000 (1.333)
33,333 - 32,000
1,333 F
4.Ove applied Fixe over heads $ 1,333 (1,000 *1.3333)
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