DATA INPUT
Actual output 13,500 cases
Actual variable overhead (Actual VOH) 607,500$
Actual fixed overhead (actual FOH) 183,000$
Actual machine time 60,750 machine hours
Standard variable-overhead rate 9.00$ per machine hour
Standard quantity of machine hours 4 hours per case of marshmallows
Budgeted fixed overhead (budgeted FOH) 180,000$ per month
Budgeted output 15,000 cases per month
SOLUTION
1) Variable-overhead spending variance = actual VOH – (AQ x SVR)
2) Variable-overhead efficiency variance = SVR x (AQ – SQ*)
= 9.00$ x 60,750 – 54,000
3) Fixed-overhead budget variance = actual FOH – budgeted FOH
= 183,000$ – 180,000$
4) Fixed-overhead volume variance = budgeted FOH – applied fixed overhead*
= 180,000$ – 162,000$
predetermined fixed overhead rate = 180,000$ / 15,000 x 4
= 607,500$ – 60,750 x 9.00$