Acc 306

ACC 306

15-28

1.Budgeted depreciation, factory equipment for September $30,000

2.Spending Variance--Equipment Depreciation Expense:

Actual depreciation for the month $28,000

Budgeted depreciation for the month 30,000

Spending variance--depreciation on equipment $2,000 F

3. Fixed Overhead Production Volume Variance:

Budgeted depreciation for the month $30,000

Total charageable hours 9,000

Standard depreciation per charageable hour $3.00

Total standard depreciation applied 27,000

Production volume variance $3,000 U

4. Reasons for the favorable spending variance include:

1. The firm disposed of some of its equipment during the period.

2. The firm changed the method it uses to determine depreciation charges.

15-31

1. Budgeted total variable factory overhead $15,000

Budgeted total direct labor hours 2,500

Standard variable factory overhead rate per direct labor hour $6.00

Budgeted total direct labor hours 2,500

Budgeted total units 5,000

Standard direct labor hours per unit 0.5

Actual variable factory overhead $15,600

Actual direct labor hours worked at the standard rate 16,200

Spending variance $600 F

Actual direct labor hours 2,700

Standard direct labor hours for units manufactured 2,400

Excess direct labor hours...