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The Mars Company applies factory overheads to production by meansof pre-determined rate based on expected actual capacity. Factoryoverhead at expected actual capacity of 120,000 hours is Rs.240,000 of which Rs. 60,000 is fixed and Rs. 180,000 is variable.Normal capacity of the company is 150,000 hours. The actualcapacity attained during the year was 100,000 hours and actualfactory overhead was Rs. 180,000.
Calculate: Pre-determined overhead rate based on expected actual capacity and normal capacity.1. Over-applied or under-applied factory overhead based on rateused by the company.2. Budget variance and volume variance
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a supplier of aircraft parts to an aircraft manufacturer has noticed an increase in inventory. as a result of this will
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