Question

Presented here are the original overhead budget and the actual costs incurred during April for Piccole, Inc. Piccolo's managers we overhead to direct labor hours for planning, control and product casting purposes. The original budget is based on budgeted production of 22.500 units in 5.700 tandard direct labor hours. Actual production of 24 400 is required 6.0 actual direct labor hour Original Budget Actus Costs SO Vale overhead Feed overhead 40.470 Required a. Calculate the texed budget allowances for variable and fixed overhead for April (Do not round Intermediate calculations.) Flexed Budget Variable tewed budget Fixed flexed budget b. Calculate the direct labore effect.. zero variance) n cy variance for April expressed in terms of direct labor hours indicate the effect of each Dest laborency ranc h ours

Answer 1

Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks!

Piccolo Inc.
It is mentioned that overhead rate are calculated on the basis of direct labor hours:
Answer a			Note
Budgeted Variable overhead	34,200.00		A
Budgeted Production units	22,800.00		B
Variable overhead per unit	1.50		C=A/B
Actual Production units	24,400.00		D
Variable overhead per unit	1.50		See C
Flexed Variable overhead Budget	36,600.00		E=D*C
Flexed Fixed overhead Budget	40,470.00
Note: Fixed overhead does not change with units so it will be same as budgeted for any level of units.
Answer b
Budgeted Production units	22,800.00		See A
Standard Direct Labor Hours	5,700.00		F
Standard Direct Labor Hours per unit	0.25		G=F/A
Actual Production units	24,400.00		See D
Standard Direct Labor Hours per unit	0.25		See G
Standard Direct Labor Hours for Actual Production units	6,100.00		H=D*G
Actual Direct Labor Hours	6,900.00		I
Direct Labor Efficiency Variance	800.00	Unfavorable	J=I-H
Answer c	Variable	Fixed
Budgeted costs	34,200.00	40,470.00	K
Standard Direct Labor Hours	5,700.00	5,700.00	See F
Calculation of predetermined overhead rate	6.00	7.10	L=K/F
Answer d	Variable	Fixed
Standard Direct Labor Hours for Actual Production units	6,100.00	6,100.00	See H
Predetermined overhead rate	6.00	7.10	See L
Overhead applied	36,600.00	43,310.00	M=H*L
Answer e
Actual Fixed cost	42,500.00		N
Standard Fixed cost	40,470.00		See K
Fixed Overhead Budget Variance	2,030.00	Unfavorable	O= N-K
Fixed Overhead Volume Variance
Standard Fixed cost	40,470.00		See K
Overhead applied	43,310.00		See M
Fixed Overhead Volume Variance	2,840.00	Favorable	P=M-K
Answer F
Actual Fixed cost	42,500.00		Q
Overhead applied	43,310.00		See M
Overhead Over applied	810.00		R=M-Q