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13 March, 13:37

The predetermined overhead rate for Zane Production Company is $10, comprised of avariable overhead rate of $6 and a fixed rate of $4. The amount of budgeted overheadcosts at normal capacity of $300,000 was divided by normal capacity of 30,000 directlabor hours, to arrive at the predetermined overhead rate of $10. Actual overhead forJune was $19,000 variable and $12,100 fixed, and standard hours allowed for theproduct produced in June was 3,000 hours. The total overhead variance is

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  1. 13 March, 13:42
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    The total variance will befor 3,100 unfavorable

    Explanation:

    Variable overhead variance:

    3,000 hours x 6 variable overhead = 18,000 variable - 19,000 = 1,000 Unfavorable

    Fixed overhead:

    30,000 x 4 = 120,000 fixed per year

    120,000 / 12 monht a year = 10,000 fixed overhead per month

    actual fixed 12,100

    variance 2,100 unfavorable

    total variance 3,100 U
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