The following data are the actual results for Marvelous Marshmallow Company for October. Actual output ................................................................................................. 9,000 casesActual variable overhead ........................................................................... $405,000Actual fixed overhead ................................................................................. $122,000Actual machine time ..................................................................... 40,500 machine hours Standard cost and budget information for Marvelous Marshmallow Company follows: Standard variable-overhead rate ..................................... $9.00 per machine hourStandard quantity of machine hours .................................... 4 hours per case of marshmallowsBudgeted fixed overhead ........................................................ $120,000 per monthBudgeted output ................................................................... 10,000 cases per month 1. Use any of the methods explained in the chapter to compute the following variances. Indicate whether each variance is favorable or unfavorable, where appropriate.a. Variable-overhead spending variance.b. Variable-overhead efficiency variance.c. Fixed-overhead budget variance.d. Fixed-overhead volume variance.2. Build a spreadsheet: Construct an Excel spreadsheet to solve the preceding requirement. Show how the solution will change if the following information changes: actual output was 9,100 cases, and actual variable overhead was $395,000.
The following data are the actual results for Marvelous Marshmallow Company for October.
Actual output ................................................................................................. 9,000 cases
Actual variable
Actual fixed overhead ................................................................................. $122,000
Actual machine time ..................................................................... 40,500 machine hours
Standard variable-overhead rate ..................................... $9.00 per machine hour
Standard quantity of machine hours .................................... 4 hours per case of marshmallows
Budgeted fixed overhead ........................................................ $120,000 per month
Budgeted output ................................................................... 10,000 cases per month
1. Use any of the methods explained in the chapter to compute the following variances. Indicate whether each variance is favorable or unfavorable, where appropriate.
a. Variable-overhead spending variance.
b. Variable-overhead efficiency variance.
c. Fixed-overhead budget variance.
d. Fixed-overhead volume variance.
2. Build a spreadsheet: Construct an Excel spreadsheet to solve the preceding requirement. Show how the solution will change if the following information changes: actual output was 9,100 cases, and actual variable overhead was $395,000.
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