90.2K

Verified Solution

Link Copied!

You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has Calculate the activity variances for March.

Note: Indicate the effect of each variance by selecting $"$F$"$ for favorable, $"$U$"$ for unfavorable, and "None" for no effect $($i$.$e$.,$

zero variance$).$ Input all amounts as positive values. Calculate the spending variances for March.

Note: Indicate the effect of each variance by selecting $"$F$"$ for favorable, $"$U$"$ for unfavorable, and "None" for no effect $($i$.$e$.,$

zero variance$).$ Input all amounts as positive values.

asked that you review the company's costing system and $"$do what you can to help us get better control of our manufacturing

overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be

an excellent first step in overhead planning and control.

After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March:

During March, the company worked $22,000$ machine$-$hours and produced $16,000$ units. The company had originally planned to work

$24,000$ machine$-$hours during March.

Required:

Calculate the activity variances for March.

Calculate the spending variances for March.

Show all imagesShow all images

Answer & Explanation Solved by verified expert

See Answer