Bài giảng Appendix 11A: Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
The volume variance can also be computed by multiplying the fixed portion of the predetermined overhead rate times the difference between denominator hours and standard hours. The equation on the prior slide and this equation result in identical answers. Both variance computations will be demonstrated in the forthcoming example.
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Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System Appendix 11ALearning Objective 11-4Compute and interpret the fixed overhead volume and budget variances.Volume varianceFixed Overhead Volume VarianceFixed Overhead AppliedActual Fixed OverheadBudgeted Fixed OverheadVolume varianceFixed overhead applied to work in processBudgeted fixed overhead=–FPOHR = Fixed portion of the predetermined overhead rate DH = Denominator hours SH = Standard hours allowed for actual output SH × FRDH × FRFixed Overhead Volume VarianceVolume varianceFPOHR × (DH – SH)=Fixed Overhead AppliedActual Fixed OverheadBudgeted Fixed OverheadVolume varianceBudget varianceFixed Overhead Budget VarianceBudget varianceBudgeted fixed overheadActual fixed overhead=–Fixed Overhead AppliedActual Fixed OverheadBudgeted Fixed OverheadPredetermined Overhead RatesPredetermined overhead rateEstimated total manufacturing overhead cost Estimated total amount of the allocation base=Predetermined overhead rate$360,000 90,000 Machine-hours=Predetermined overhead rate= $4.00 per machine-hourPredetermined Overhead RatesVariable component of the predetermined overhead rate$90,000 90,000 Machine-hours=Variable component of the predetermined overhead rate= $1.00 per machine-hourFixed component of the predetermined overhead rate$270,000 90,000 Machine-hours=Fixed component of the predetermined overhead rate= $3.00 per machine-hourApplying Manufacturing OverheadOverhead appliedPredetermined overhead rateStandard hours allowed for the actual output=×Overhead applied$4.00 per machine-hour84,000 machine-hours=×Overhead applied$336,000=Computing the Volume VarianceVolume varianceFixed overhead applied to work in processBudgeted fixed overhead=–Volume variance= $18,000 UnfavorableVolume variance= $270,000 –$3.00 permachine-hour(×$84,000machine-hours)Computing the Volume VarianceFPOHR = Fixed portion of the predetermined overhead rate DH = Denominator hours SH = Standard hours allowed for actual outputVolume varianceFPOHR × (DH – SH)=Volume variance=$3.00 permachine-hour(×90,000mach-hours–84,000mach-hours)Volume variance= 18,000 UnfavorableComputing the Budget VarianceBudget varianceBudgeted fixed overheadActual fixed overhead=–Budget variance= $280,000 – $270,000Budget variance= $10,000 UnfavorableA Pictorial View of the VariancesFixed Overhead Applied to Work in ProcessActual Fixed OverheadBudgeted Fixed Overhead 280,000270,000252,000Total variance, $28,000 unfavorableBudget variance,$10,000 unfavorableVolume variance,$18,000 unfavorableEnd of Appendix 11A
