Reference no: EM132941119

Question - Company manufactures a single product that requires a great deal of hand labor. Overhead cost is applied on the basis of direct labor hours. The company's condensed flexible budget for manufacturing overhead is given below: Overhead Costs Cost Formula (per DL hour) Direct Labor Hours 45,000 60,000 75,000 Variable costs 2.00 90,000 120,000 150,000 Fixed costs 480,000 480,000 480,000 Total overhead costs 570,000 600,000 630,000 The company's products requires 3 kilos of material that has a standard cost of Php 7 per kilo and Php 1.50 hours of direct labor time that has a standard rate of Php 6 per hour. The company planned to operate at a denominator activity level of 60,000 direct labor hours and to produce 40,000 units of product during the most recent year. Actual activity and costs for the year were as follows: Number of units produced 42,000 Actual direct labor hours worked 65,000 Actual variable overhead cost incurred 123,500 Actual overhead cost incurred 483,000

Required -

1. What were the standard hours allowed for the year's output?

2. Compute the variable overhead spending variance?

3. Compute the overhead efficiency variance?

4. Compute the fixed overhead budget variance?

5. Compute the overhead volume variance?