Overhead Variances Overhead Is Applied on the Basis of Direct Labor Hours.Three

question 2

Essay

Overhead Variances
Overhead is applied on the basis of direct labor hours.Three direct labor hours are required for each product unit.Planned production for the period was set at 8,000 units.Manufacturing overhead for the period is budgeted at $204,000,of which 30 percent is fixed.The 26,200 hours worked during the period resulted in production of 8,500 units.Manufacturing overhead cost incurred was $220,500.
Required:
Calculate the following three overhead variances:
a.Overhead volume variance.
b.Overhead efficiency variance.
c.Overhead spending variance.

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