Reference no: EM133092841
Question 1 - The data below relate to the month of November for Badong, Inc. which uses a standard cost system:
Actual direct labor cost $43,400
Actual hours used 14,000
Standard hours allowed for good output 15,000
Direct labor rate variance - debit 1,400
Actual total overhead 32,000
Budgeted fixed cost 9,000
Normal activity in hours 12,000
Total application rate per standard direct labor hour 2.25
Badong uses a two-way analysis of overhead variance.
a. What was Badong's budget (controllable) variance for November?
b. What was Badong's volume variance for November?
Question 2 - Casiu Company began its operations on January 1, 2021, and produces a single product that sells for $10.00 per unit. Casiu uses an actual (historical) cost system. In 2021, 100,000 units were produced and 80,000 units were sold. There was no work-in-process inventory at December 31, 2021. Manufacturing costs and selling and administrative expenses for 2021 were as follows:
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Fixed cost
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Variable cost
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Raw materials
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-
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P2.00 per unit
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Direct labor
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-
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P1.25 per unit
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Factory overhead
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$120,000
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P0.75 per unit
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Selling & administrative
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70,000
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P1.00 per unit
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a. What would be Casiu's operating income for 2021 under variable costing method?
b. What would be Casiu's operating income for 2021 under absorption costing method?
Question 3 - Wilms, Inc. uses a standard cost system. Overhead cost information for product A for the month of November is as follows:
Total actual overhead incurred $12,600
Fixed overhead budgeted $ 3,300
Total standard overhead rate per direct labor $ 4.00
Variable overhead rate per direct labor hour $ 3.00
Standard hours allocated for actual production 3,500
What is the overall (or net) overhead variance?