Fixed manufacturing overhead, variance analysis (continuation of 8-21). Esquire Clothing allocates fixed manufacturing overhead to each suit using budgeted direct manufacturing labor-hours per suit. Data pertaining to fixed manufacturing overhead costs for June 2017 are budgeted, $62,400, and actual, $63,916.Required:Compute the spending variance for fixed manufacturing overhead. Comment on the results.Compute the production-volume variance for June 2017. What inferences can Esquire Clothing draw from this variance?

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Asked Jan 8, 2020
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Fixed manufacturing overhead, variance analysis (continuation of 8-21). Esquire Clothing allocates fixed manufacturing overhead to each suit using budgeted direct manufacturing labor-hours per suit. Data pertaining to fixed manufacturing overhead costs for June 2017 are budgeted, $62,400, and actual, $63,916.

Required:

  1. Compute the spending variance for fixed manufacturing overhead. Comment on the results.
  2. Compute the production-volume variance for June 2017. What inferences can Esquire Clothing draw from this variance?
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