Happy Valley Pet Products uses a standard costing system that applies overhead to products based on standard direct labour-hours allowed for actual output of the period. During the recent year, the following data were collected:
|
Total budgeted fixed overhead cost for the year
|
$95,500
|
|
Actual fixed overhead cost for the year
|
$92,500
|
|
Budgeted standard direct labour-hours
|
19,100
|
|
Actual direct labour-hours
|
20,500
|
|
Standard direct labour-hours allowed for the actual output
|
17,600
|
Required:
1. Compute the fixed portion of the predetermined overhead rate for the year
2. Compute the fixed overhead budget and volume variances