Everjoice Company Makes Clocks

question 106

Essay

Everjoice Company makes clocks.The budgeted fixed overhead costs for 2018 total $720,000.The company uses direct labour-hours for fixed overhead allocation and anticipates 240,000 hours during the year for 480,000 units.An equal number of units are budgeted for each month.During June, 42,000 clocks were produced and $63,000 were spent on fixed overhead.Required:
a.Determine the fixed overhead rate for 2018 based on units of input.
b.Determine the fixed overhead static-budget variance for June.
c.Determine the production-volume overhead variance for June.