DeNozio Enterprises Gathered the Following Information for the Month of July

question 42

Essay

DeNozio Enterprises gathered the following information for the month of July:
Overhead flexible budget:
Gordon actually produced 13,000 units in 16,400 machine hours. Total actual overhead cost of $82,000 consisted of $33,000 variable costs and $49,000 fixed costs. The standard variable and fixed overhead rates are based on a master (static) budget of 12,000 units. Assume the allocation base for fixed overhead costs is the number of units.
Required:
1. Compute the total manufacturing overhead cost variance.
2. Compute the variable overhead flexible budget variance.
3. Compute the fixed overhead budget variance.
4. Compute the production volume variance.

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Definitions:

Basic Motions

The fundamental human movements or actions that can be combined in various ways to perform work or tasks efficiently.

Therbligs

Fundamental motions required for a worker to perform manual operations, used in the study of motion economy.

Work Sampling

A statistical technique used for analyzing the work performance and estimating the proportion of time spent by workers on different activities.

Stopwatch Time Study

A method of work measurement used to establish standard times for activities by observing and timing tasks using a stopwatch.