IWI Auto Parts Corporation located in Michigan manufactures auto accessories including floor mats and liners, and car co

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answerhappygod
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IWI Auto Parts Corporation located in Michigan manufactures auto accessories including floor mats and liners, and car co

Post by answerhappygod »

IWI Auto Parts Corporation located in Michigan manufactures auto
accessories including floor mats and liners, and car covers. IWI's
predetermined variable overhead rate is based on direct
labor-hours.
In the most recent month, 180,000 products were shipped
using 7,700 direct labor-hours. IWI incurred a total of $26,180 in
variable overhead costs.
According to the corporation's standards, 0.03 direct
labor-hours are required to fulfill an order for one
product and the variable overhead rate is $3.45 per direct
labor-hour.
Required:
1. What is the standard labor-hours allowed (SH) to ship 180,000
products to customers?
2. What is the standard variable overhead cost allowed (SH × SR)
to ship 180,000 products to customers?
3. What is the variable overhead spending variance?
4. What is the variable overhead rate variance and the variable
overhead efficiency variance?
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