LampLight Industries Gathered the Following Information for the Month of July

question 129

Essay

LampLight Industries gathered the following information for the month of July:
Overhead flexible budget:
LampLight actually produced 14,000 units in 17,500 machine hours. Total actual overhead cost of $85,500 consisted of $35,000 variable costs and $50,500 fixed costs. The standard variable and fixed overhead rates are based on a master (static)budget of 15,000 units. Assume the allocation base for fixed overhead costs is the number of units.
A. Compute the total manufacturing overhead cost variance.
B. Compute the overhead flexible budget variance.
C. Compute the production volume variance.

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Definitions:

Simple Linear Regression

A statistical method for modeling the relationship between a single independent variable and a dependent variable by fitting a linear equation to observed data.

Least Squares

A mathematical method used to determine the best-fitting line through a set of data points by minimizing the sum of the squares of the differences between observed and estimated values.

Standard Deviation

A measure of the dispersion or variability of a set of data points around the mean, indicating how spread out the data points are.

SPSS

Statistical Package for the Social Sciences, a software package used for data management and statistical analysis.