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Weller Company's flexible budget for manufacturing overhead (in condensed form) follows:
Overhead Costs
Cost formula
Machine hours
(per machine hour)
8,000
9,000
10,000
Variable cost...
$1.05
$8,400
$9,450
$10,500
Fixed cost...
24,800
Total overhead cost...
$32,200
$34,250
$35,300
The following information is available for a recent period:
Number of units produced... 3,500
Actual machine hours... 8,500
Actual variable overhead costs... $9,860
Actual fixed overhead costs... $25,100
1. Compute the predetermined overhead rate and break it down into variable and fixed cost elements?
2. What were the standard hours allowed for the year's actual output?
3.Compute the variable overhead spending and efficiency variances and the fixed overhead budget and volume variances.
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