Bob Burgie Company produces one product, a putter called GO-Putter. Burgie uses a standard cost system and determines that it should take one hour of direct labor to produce one GO-Putter. The normal production capacity for this putter is 105,000 units per year. The total budgeted overhead at normal capacity is $735,000 comprised of $210,000 of variable costs and $525,000 of fixed costs. Burgie applies overhead on the basis of direct labor hours.
a) Compute the predetermined variable overhead rate and the predetermined fixed overhead rate
Predetermined variable overhead rate $
Predetermined fixed overhead rate
$Compute the applied overhead for Levitt for the year.
$Compute the total overhead variance.
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