you have just been hired by fab corporation the manufacturer of revolutionary new garage door op

Name: you have just been hired by fab corporation the manufacturer of revolutionary new garage door opening device the president has asked that you review the company costing system and do what yo 59174
Uploaded: 2023-05-26T11:01:20-08:00
Duration: 2 min 3 s
Channel: Numerade
Description: you have just been hired by fab corporation the manufacturer of revolutionary new garage door opening device the president has asked that you review the company costing system and do what yo 59174

According to the question, percentage of direct labour cost, labour cost method equals to 600000

Hello students, in this question, we have to compute the predetermined manufacturing overhead ra

See, first we determine the cost of raw material to include in the planning budget. So raw mater

Question

You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and do what you can to help us get better control of our manufacturing overhead costs. You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you have determined the following cost formulas and gathered the following actual cost data for March: Actual Cost March Cost Formula: $816,000 plus $838,800 per machine hour Utilities: $200,200 Maintenance: $5,125 Supplies: $600,000 Indirect labor: $300,000 Depreciation: $594,100 plus $1 per machine hour During March, the company worked 16,000 machine-hours and produced 10,000 units. The company had originally planned to work 18,000 machine-hours during March. Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March.

          You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and do what you can to help us get better control of our manufacturing overhead costs. You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control.

After much effort and analysis, you have determined the following cost formulas and gathered the following actual cost data for March:

Actual Cost March
Cost Formula: $816,000 plus $838,800 per machine hour
Utilities: $200,200
Maintenance: $5,125
Supplies: $600,000
Indirect labor: $300,000
Depreciation: $594,100 plus $1 per machine hour

During March, the company worked 16,000 machine-hours and produced 10,000 units. The company had originally planned to work 18,000 machine-hours during March.

Required:
1. Calculate the activity variances for March.
2. Calculate the spending variances for March.

Added by Miguel -Ngel F.

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