Concept explainers
(a) (1)
Overhead Controllable Variance: The overhead controllable variance is a type of overhead variance which is the variance of the overhead price. This variance refers to the difference arising between the real overhead which is incurred and the overhead which is planned or estimated for the allowed standard hours.
Overhead Volume Variance: The overhead volume variance refers to the variance which arises when there is difference between the normal hours of working and the standard hours which are estimated. This is the difference between the production overhead which is estimated and the production overhead which is actually incurred. The difference of the production overhead is multiplied by the given fixed rate of overhead to calculate the overhead volume variance.
To Determine: The total actual overhead cost.
(2)
The actual variable overhead cost.
(3)
The variable overhead cost applied.
(4)
The fixed overhead cost applied.
(5)
The overhead volume variance.
(b)
The number of loans were processed.
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Managerial Accounting: Tools for Business Decision Making
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