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Question - Happy Valley Pet Products uses a standard costing system that applies overhead to products based on standard direct labour-hours allowed for actual output of the period. During the recent year, the following data were collected:
Total budgeted fixed overhead cost for the year $52,030
Actual fixed overhead cost for the year $49,730
Budgeted standard direct labour-hours 12,100
Actual direct labour-hours 13,100
Standard direct labour-hours allowed for the actual output 10,600
Required -
1. Compute the fixed portion of the predetermined overhead rate for the year.
2. Compute the fixed overhead budget and volume variances.
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