Original Message:

Sent: 5/15/2023 7:24:00 AM

From: Sura Hitesh

Subject: RE: Fixed overhead production volume variance.

(actual hrs - standard hrs) = 424

actual hrs = 424+32000

so according to equation it will be 32424

but why should we reduce it , and as they have mentioned in question its unfavourable actual hrs should atleast be more than 32000,how come its 31576

Original Message:

Sent: 5/14/2023 3:54:00 AM

From: Kishore Kumar Natakala

Subject: RE: Fixed overhead production volume variance.

Hi,

I have one point to ask here to you.

Do you have to use Actual hours used in calculating the volume variance?

It is for the actual production units the standard hours allowed for that actual production is used in the formula.I.e. SH.

Here,SH in the formula means standard hours used for actual production units..

Thanks

Original Message:

Sent: 5/14/2023 3:36:00 AM

From: Ron Thomas

Subject: RE: Fixed overhead production volume variance.

The question has asked for actual hours, not standard hours which is what is confusing me.

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Ron Thomas

Palakkad

India

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Original Message:

Sent: 05-14-2023 03:01 AM

From: Kishore Kumar Natakala

Subject: Fixed overhead production volume variance.

Hi ,

Given Volume variance Unfavorable $6,360/-.

Thus, in terms of Hours it is 6,360/15 = 424 hours.

given, budgeted machine hours 32,000 and hence, The SH allowed for actual production (SH) will be 31,576 [ i.e.32,000-424 hours ]

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Kishore Kumar N

Bengaluru

Karnataka

India

Original Message:

Sent: 05-13-2023 03:42 AM

From: Ron Thomas

Subject: Fixed overhead production volume variance.

A company ends the month with a volume variance of $6,360 unfavorable. If budgeted fixed O/H

was $480,000, O/H was applied on the basis of 32,000 budgeted machine hours, and budgeted variable O/H was

$170,000, what were the actual number of machine hours (AH) for the month?

A. 32,425

B. 32,318

C. 32,000

D. 31,576

Answer is D.

Anyone please help me understand this question. While I do the calculation according to the formula I'm getting 31,576 as the standard hours. But the answer shows 31576 as the actual hours. Help me please understand the question.

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Ron Thomas

Palakkad

India

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