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Rountree makes and sells a range of products; all are made when ordered. The standard labour cost for product XJ is 4 hours at 23 per hour.
Rountree has the following monthly budget data: Total labour hours of 6,000 hours per month; Variable overheads of 120,000 per month:
Fixed overheads of 600,000 per month.
A recent order for 200 units of XJ had the following actual costs: Labour: 650 hours costing 21,450
Variable overheads of 14,400 Fixed overheads of 96,000
Overheads are charged to production using standard labour hours. All variances are rounded to the nearest 1
What is the correct variable overhead rate variance for the order?
What is the correct total variable overhead variance?
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