Solution-Determine the fixed overhead budget variance for

Determine the fixed overhead budget variance for June

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Question - The Tick-Tock Company makes clocks. The budgeted fixed overhead costs for 2020 total $720,000, spread evenly throughout the year. The company uses direct labour-hours as the allocation base for fixed overhead and has budgeted 24,000 hours for the year. Tick-Tock budgeted to produce 4,800 clocks in 2020, or 400 per month.

During June, 420 clocks were actually produced and $63,000 was spent on fixed overhead.

Required -

a. Determine the fixed overhead application rate for 2020.

b. Determine the fixed overhead budget variance for June.

c. Determine the fixed overhead production-volume variance for June.

d. Explain why there is no efficiency variance for fixed manufacturing overhead costs.

Reference no: EM132837459

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Determine the fixed overhead budget variance for June

Reference no: EM132837459

Reference no: EM132837459

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