(Solution) - Walkenhorst Company s machining department prepared its 2010 bud -(2025 Original AI-Free Solution)

Paper Details

Walkenhorst Company?s machining department prepared its 2010 budget based on the following data:
Practical capacity ............. 40,000 units
Machine hours per unit .......... 2
Variable factory overhead ......... $3.00 per machine hour
Fixed factory overhead .......... $360,000
The department uses machine hours to apply factory overhead. In 2010, the department used 85,000 machine hours and $625,000 in total manufacturing overhead to manufacture 42,000 units. Actual fixed overhead for the year was $375,000.

Required
Set up an Excel spreadsheet to determine for the year:
1. The variable, fixed, and total factory overhead application rates.
2. The flexible budget for overhead cost based on output achieved in 2010.
3. The production-volume variance.
4. The total overhead spending variance.
5. The overhead efficiency variance.
6. The variable and fixed overhead spending variances.