Solution-What was the production volume variance for the

What was the production volume variance for the year

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Question - The following data is from the records of Blue Wings Corporation which manufactures hang-gliders. Its cost accounting system is based on standard absorption costing. The company writes off its variances to cost of goods sold. The data corresponds to Blue Wings' first year of operation. Blue Wings manufactured 1,000 hang-gliders and sold 700. There was no work-in-process at the end of the year.

Budgeted fixed manufacturing overhead costs $ 100,000

Under-allocated fixed manufacturing overhead $ 32,000

Fixed manufacturing overhead spending variance $ 12,000 (unfavorable)

-What was the production volume variance for the year?

-What was the budgeted fixed manufacturing overhead rate per glider?

-If Blue Wings had used practical capacity as the denominator volume to set its fixed manufacturing overhead rate, at what percentage of practical capacity did Blue Wings operate during the year?

Reference no: EM132975242

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What was the production volume variance for the year

Reference no: EM132975242

Reference no: EM132975242

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