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Chan uses a standard costing in its manufacturing plant for car-(Answered)


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  • Chan uses a standard costing in its manufacturing plant for car parts. The standard cost of a particular car part, based on a denominator level of 4000 output units per year, included 6 machine hours of variable manufacturing overhead at $8 per hour and 6 machine hours of fixed manufacturing overhead at $15 per hour. Actual output produced was 4400 units. Variable manufacturing overhead incurred was $245,000. Fixed manufacturing overhead incurred was $373,000.Actual machine hours were 28,400.
  • Required:
  • 1.?Prepare?an?analysis?of?all?variable?manufacturing?overhead?and??fixed?manufacturing?overhead?variances,?using?a?4?variance?analysis.??????????????????????(4?Marks)
  • 2.?Describe?how?individual?fixed?manufacturing?overhead?items?are??controlled?from?day?to?day.?????????????????????????????????????????????????????????????????????????????????????????????????(2?Marks)
  • 3. Discuss possible causes of the fixed manufacturing overhead variance.


Paper#9256245 | Written in 27-Jul-2016

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