Everjoice Company Makes Clocks

question 27

Essay

Everjoice Company makes clocks.The budgeted fixed overhead costs for 2015 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 2015 based on units of input.
b.Determine the fixed overhead static-budget variance for June.
c.Determine the production-volume overhead variance for June.

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Definitions:

Strategic Plans

Long-term planning documents that articulate an organization's goals, strategies for achieving those goals, and measures for assessing progress.

Operational Plan

A detailed outline of how a strategy will be implemented in terms of resources and actions needed to achieve specific objectives.

System Capacity

The maximum output or performance level that a system can handle, which can refer to organizations, networks, or technical systems.

Nonprofit's System

A nonprofit's system comprises the organizational structures, processes, and practices that enable a nonprofit organization to pursue its mission effectively.