Chap 10 qz question 10 The following data have been provided by Lopus Corporatio

Question

Chap 10 qz question 10

The following data have been provided by Lopus Corporation:

Required:

Compute the variable overhead rate variances for lubricants and for supplies. Indicate whether each of the variances is favorable (F) or unfavorable (U).

(Input all amounts as positive values.)

Budgeted production 3,600 units Standard machine-hours per unit 3.7 machine-hours Standard lubricants $ 5.20 per machine-hour Standard supplies $ 3.90 per machine-hour Actual production 3,900 units Actual machine-hours 9,080 machine-hours Actual lubricants (total) $ 48,874 Actual supplies (total) $ 34,874

Explanation / Answer

standerd units 3600 Actual units 3900 Total standerd hours 13320 Total actual hours 9080 Lubricants rate 5.2 Lubricants Rate 5.382599 supplies rate 3.9 Supplies rate 3.840749 LUBRICANTS SUPPLIES Standerd variable Cost 69264 51948 Actual variable Cost 48874 34874 Variable Cost Varience 20390 F 17074 variable Overhead Spending Varience (SR-AR)* Actual hours worked -1658 u 538 Varible Overhead Efficiency varience (Standerd hours worked - actual hours )*SR 22048 F 16536

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