b. Calculate the following variances: 1. Variable overhead spending variance 2. Variable overhead efficiency variance 3. Fixed overhead spending variance 4. Fixed overhead volume variance

Extracted text: b. Calculate the following variances: 1. Variable overhead spending variance 2. Variable overhead efficiency variance 3. Fixed overhead spending variance 4. Fixed overhead volume variance


Extracted text: Little Company uses a standard costing system. The following monthly cost functions apply to its manufacturing overhead items: Cost Function PO.80 per DLH P1.00 per DLH P0.40 per DLH P8,000 P32,000 Overhead Item Indirect materials Indirect labor Utilities Insurance Depreciation Information for the month of October is as follows: Actual overhead costs incurred: Indirect materials P20,800 24,000 9,600 8,800 32,000 P95,200 Indirect labor Utilities Insurance Depreciation Total Actual direct labor hours worked 24,000 Standard direct labor hours allowed for production achieved 27,000 Little uses expected capacity to calculate standard overhead rates. The monthly expected capacity is 25,000 hours. Required: а. Calculate the following standard overhead rates based upon expected capacity: