Solution-Perform a three-way breakdown of the total

Perform a three-way breakdown of the total overhead variance

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Reference no: EM13876776

Three-Variance Analysis Use the following data for Marilyn, Inc.

Actual total cost for direct labor	$86,800
Total direct labor hours worked	14,000
Total standard labor hours for the output in April	15,000
Direct labor rate variance-unfavorable	$2,800
Actual total overhead cost	$32,000
Budgeted fixed overhead cost	$9,000
Practical capacity, in hours	12,000
Total overhead application rate per standard direct labor hour	$2.25

Required: Use a model similar to the one presented in text Exhibit to perform a three-way breakdown of the total overhead variance, as follows:

1. Overhead spending variance.

2. Variable overhead efficiency variance.

3. Production-volume variance

4. Prepare a reconciliation of results from the two-variance and three-variance approaches.

Reference no: EM13876776

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Perform a three-way breakdown of the total overhead variance

Reference no: EM13876776

Reference no: EM13876776

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