Factory Overhead Cost Variances Discussion

timer Asked: Feb 24th, 2014

Question description

Perma Weave Textiles Corporation began January with a budget for 46,000 hours of production in the Weaving Department. The department has a full capacity of 61,000 hours under normal business conditions. The budgeted overhead at the planned volumes at the beginning of January was as follows:

Variable overhead$87,400
Fixed overhead61,000

The actual factory overhead was $150,200 for January. The actual fixed factory overhead was as budgeted. During January, the Weaving Department had standard hours at actual production volume of 48,000 hours. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your interim computations to the nearest cent, if required.

a.  Determine the variable factory overhead controllable variance.
$ SelectFavorableUnfavorable

b.  Determine the fixed factory overhead volume variance
$ SelectFavorableUnfavorable

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