Answer subparts:

1. Calculate the standard VMOH allocated to production during the year and prepare journal entry:

VMOH Allocated: $_____________________

1. Calculate the standard FMOH allocated to production during the year and prepare journal entry:

FMOH Allocated $_______________________

MOH VARIANCES (indicate whether favorable (F) or unfavorable (U):

5A.       Calculate the total VMOH variance:

                                                                                                                        Total VMOH VAR. $__________

5B.        Calculate the VMOH spending (price) variance:

                                                                                                            VMOH Spending Var.: $_____________U    F

5C.        Calculate the VMOH efficiency (quantity) variance:

                                                                                                            VMOH Efficiency Var.: $____________U    F

6A        Calculate the total FMOH variance:

                                                                                                                                    Total FMOH VAR. $________

6B        Calculate FMOH Spending variance:

                                                                                                            FMOH Spending Var.: $____________U    F

6C        Calculate FMOH Volume variance:                    

                                                                                                            FMOH Volume Var.: $_____________U    F

STANDARD COST SYSTEM – MOH VARIANCES (must show calculations)

Company budgeted production level in units is 60,000 units of output with a budgeted fixed cost of $480,000 and budgeted variable cost of $348,000.  Each unit requires 2 hours of direct labor. (Use T accounts to help yourself)

Actual results:

            Production: 58,500 units

            Direct labor hours used:  128,700

            Total actual MOH costs incurred:  $819,228

            Total actual FIXED MOH costs incurred:  $480,643

1. Calculate the standard (budgeted) VMOH cost per unit and per hour:

VMOH per unit: $__________________

VMOH per hour: $_________________

1. Calculate the standard (budgeted) FMOH cost per unit and per hour:

FMOH per unit: $___________________

FMOH per hour: $___________________

1. Calculate the standard VMOH allocated to production during the year and prepare journal entry:

VMOH Allocated: $_____________________

1. Calculate the standard FMOH allocated to production during the year and prepare journal entry:

FMOH Allocated $_______________________

MOH VARIANCES (indicate whether favorable (F) or unfavorable (U):

5A.       Calculate the total VMOH variance:

                                                                                                                        Total VMOH VAR. $__________

5B.        Calculate the VMOH spending (price) variance:

                                                                                                            VMOH Spending Var.: $_____________U    F

5C.        Calculate the VMOH efficiency (quantity) variance:

                                                                                                            VMOH Efficiency Var.: $____________U    F

6A        Calculate the total FMOH variance:

                                                                                                                                    Total FMOH VAR. $________

6B        Calculate FMOH Spending variance:

                                                                                                            FMOH Spending Var.: $____________U    F

6C        Calculate FMOH Volume variance:                    

                                                                                                            FMOH Volume Var.: $_____________U    F