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    panchaga's Avatar
    panchaga Posts: 3, Reputation: 1
    New Member
     
    #1

    Oct 18, 2010, 08:15 PM
    Managerial accounting
    A manufacturing company uses standard costing and applies overhead on the basis of direct labor hours. The company experienced the following results in August:

    Standard direct labor hours allowed for actual production 9,000
    Actual direct labor hours used 9,250
    Predetermined overhead rate (per direct labor hour) $45
    Flexible budget overhead for standard hours allowed $410,000

    The overhead volume variance for the month is
    rehmanvohra's Avatar
    rehmanvohra Posts: 739, Reputation: 27
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    #2

    Oct 20, 2010, 09:24 PM

    I am sure you know the formula for calculating variances.

    Here is the formula for volume variance:

    (Standard hours allowed - actual hours worked) x standard overhead rate.

    Plug in the figures and you have your answer.

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