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tamaranim1 [39]
3 years ago
14

MC Qu. 120 Levelor Company's flexible budget shows... Levelor Company's flexible budget shows $10,640 of overhead at 75% of capa

city, which was the operating level achieved during May. However, the company applied overhead to production during May at a rate of $2.20 per direct labor hour based on a budgeted operating level of 6,050 direct labor hours (90% of capacity). If overhead actually incurred was $11,106 during May, the controllable variance for the month was:
Business
1 answer:
slava [35]3 years ago
8 0

Answer: $466 Unfavorable

Explanation:

The Controllable variance is found by the formula:

= Flexible budget overhead - Actual Overhead incurred

= 10,640 - 11,106

= -$466

As this is a negative, it is an Unfavorable variance because it shows that actual overhead was higher than planned.

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