question archive The loan department of Local Bank uses standard costs to determine the overhead cost of processing loan applications
The loan department of Local Bank uses standard costs to determine the overhead cost of processing loan applications
Subject:FinancePrice: Bought3
The loan department of Local Bank uses standard costs to determine the overhead cost of processing loan applications. During the current month a fire occurred, and the accounting records for the department were mostly destroyed. The following data were salvaged from the ashes.Standard variable overhead rate per hour ………………………….$9Standard hours per application ………………………………………2Standard hours allowed …………………………………………2,000Standard fixed overhead rate per hour ……………………………..$6Actual fixed overhead cost …………………………………..$13,200Variable overhead budget based on standard hours allowed …$18,000Fixed overhead budget ………………………………………$13,200Overhead controllable variance ……………………………… $ 1,500 UInstructions(a) Determine the following.(1) Total actual overhead cost.(2) Actual variable overhead cost.(3) Variable overhead cost applied.(4) Fixed overhead cost applied.(5) Overhead volume variance.(b) Determine how many loans were processed.
