Answered

Bonita Industries uses flexible budgets. At normal capacity of 20000 units, budgeted manufacturing overhead is: $60000 variable and $270000 fixed. If Stone had actual overhead costs of $331600 for 22000 units produced, what is the difference between actual and budgeted costs?\

Answer :

Shakiru

Answer: actual is less than budgeted cost by $31,400

Explanation:

At normal capacity budgeted overhead cost per unit is

$330,000/20,000 unit= $16.5

Budgeted overhead cost for 22000 units

= $16.5 * 22,000units

=. $363,000

Actual overhead cost for 22,000 unit as given in the question=$331,600

The actual is less than budgeted by $31,400 which means a favourable variance.

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