Ask Question
15 April, 00:39

The following information relating to a company's overhead costs is available. Col1 = Actual total variable overhead, Actual total fixed overhead, Budgeted variable overhead rate per machine hour, Budgeted total fixed overhead, Budgeted machine hours allowed for actual outputCol2 = $ 73,000, $ 17,000, $ 2.50, $ 15,000, 30,000 Based on this information, the total variable overhead variance is:A) $2,000 favorable.

B) $6,000 favorable.

C) $2,000 unfavorable.

D) $6,000 unfavorable.

E) $1,000 favorable.

+1
Answers (1)
  1. 15 April, 02:02
    0
    A) $2,000 favorable

    Explanation:

    Actual total variable overhead = $ 73,000

    Actual total fixed overhead = $ 17,000

    Budgeted variable overhead rate per machine hour = $ 2.50

    Budgeted total fixed overhead = $ 15,000

    Budgeted machine hours allowed for actual output = 30,000

    Budgeted variable overhead = $ 2.50 x 30,000 = $ 75,000

    Variable overhead variance = Budgeted variable overhead - Actual total variable overhead

    Variable overhead variance = $ 75,000 - $ 73,000 = $ 2,000

    Since the actual value is under the budgeted value, the variable overhead variance is $2,000 favorable.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The following information relating to a company's overhead costs is available. Col1 = Actual total variable overhead, Actual total fixed ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers