Reference no: EM132549581

Question - Company uses standard costing. The company prepared its static budget for 2018 at 2,500,000 machine hours for the year. Total budgeted overhead cost is $33,500,000. The variable overhead rate is $11 per machine hour ($22 per unit). Actual result for 2018 as follow:

Machine-hours 2,400,000 hours

Output 1,230,000 units

Variable overhead $27,600,000

Fixed overhead rate variance $1,350,000 U

I. Calculate for the fixed overhead:

a. Budgeted amount.

b. Budgeted cost per machine-hour.

c. Actual cost.

d. Production-volume variance.

II. Calculate the variable overhead rate variance and the variable overhead efficiency variance.