At the end of the year, the Comptroller accumulated the total actual costs and hours incurred by Department A and Department B during the year for the company. Using the information provided below, calculate the final overhead rates for both departments. Plant Total Department B Department A $25,000 $362,000 $337,000 Direct Material Cost $99,000 $459,400 $360,400 Direct Labor Cost $495,000 $794,000 $299,000 Department Overhead Cost 43,000 9,000 34,000 Direct Labor Hours 42,000 41,000 1,000 Machine Hours per direct labor hour Department A: Department B per machine hour
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
At the end of the year, the Comptroller accumulated the total actual costs and hours incurred by Department A and Department B during the year for the company. Using the information provided below, calculate the final
Step by step
Solved in 3 steps with 1 images
