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Overhead Application, Overhead Variances, Journal Entries

Plimpton Company produces countertop ovens. Plimpton uses a standard costing system. The standard costing system relies on direct labor hours to assign overhead costs to production. The direct labor standard indicates that two direct labor hours should be used for every oven produced. The normal production volume is $100,000$ units. The budgeted overhead for the coming year is as follows:

Fixed overhead$$760,000$Variable overhead$444,000**$At normal volume.

Plimpton applies overhead on the basis of direct labor hours.

During the year, Plimpton produced $97,000$ units, worked $196,000$ direct labor hours, and incurred actual fixed overhead costs of $$770,500$ and actual variable overhead costs of $$435,600.$ Required:

$1.$ Caloulate the standard fixed owiehead tate and the standard variable ovirtwad rate. Round your answers to the mearest cemt. Use rounded answers in the subsecuent computations.

Standard fixed everthead rate per diruct labor hour

Standard variable overthad rate per dirnect labor hour

$2.$ Compote the apolied fised overthead and the appled vieriable owithata. Use the applications ratis from part $(1)$ in your calculations.

What is the total vartiable covirhead variation? $-$

$3.$ Break comn the total fixod creishead variance into a sponding vartiance and a volume vieriance.

Spendisc, Wariance $?-$

volume Variatrou $\backslash (\backslash$leqslant $\backslash )$

$\backslash [$

$5$

$\backslash ]$

$4.$ Compute the variable treerhead spending and efficincy wartancis.

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