Reference no: EM133011392

Overhead Information for Cran-Mar Company for October follows:

Total factory $30,200

Budgeted fixed factory overhead cost $7,127

Total Standard overhead rate per machine hour (MH) $4.92

Standard variable factory overhead rate per MH $3.20

Standard MHs allows for the units manufactured 3,800

Required:

Problem 1. What is the standard fixed factory overhead rate per machine hour (MH)?

Problem 2. What is the denominator activity level that was used to establish the fixed factory overhead application rate?

Problem 3. Two-way analysis (breakdown) of the total factory overhead cost variance; calculate the following factory overhead cost variances for October and indicate whether each variance is favorable (F) or unfavorable (U).

a.) Total flexible-budget variance.

b.) Production volume variance

c.) Total overhead variance.

Problem 4. Calculate the production volume variance and indicate whether the variance is favorable (F) or unfavorable (U).