The following information is available for Patrick Products for the year: Budgeted sales during the year 5,000 units Actual sales during the year 4,500 units Budgeted machine hours required for the year 10,000 hours Actual machine-hours during the year 9,000 hours Budgeted variable overhead costs $2,500,000 Actual variable overhead costs $2,375,000 What is the variable overhead flexible-budget variance for the year?

$125,000 Adverse variance as the cost actually incurred is higher.

Explanation:

The first step here is to find the Flexed Variable Overhead Cost by using the unitary method:

Budgeted overhead cost for 10,000 budgeted hrs = $2500,000

Budgeted overhead cost for 1 budgeted hrs = $2500,000 / 10000 bud. hrs

Budgeted overhead cost for 1 budgeted hrs = $250 per standard hr

And as we know that

Flexed Variable Overhead Budget = Actual Units * Budgeted overhead cost for standard hr

By simply putting values we have:

Flexed Variable Overhead Budget = 9000 hours * $250 per standard hr

= $2,2500,000

Now we will find the Flexible-budget Variable Overhead Variance by taking the difference of Variable overhead flexible budget and Actual Variable Overhead.

Flexible-budget Variable Overhead Variance = Variable overhead flexible budget - Actual Variable Overhead

By putting the values we have:

Flexible-budget Variable Overhead Variance = $2,2500,000 - $2,375,000

= $125,000 Adverse variance as the cost actually incurred is higher.

variable overhead flexible-budget variance for the year is $125,000

Explanation:

What we need to do is to get the flexed Variable Overhead Cost and we can get this by the method of unitary;

The value of the is budgeted overhead cost for 10,000 budgeted hrs = $2500,000

And also

The value of the budgeted overhead cost for 1 budgeted hrs = $2500,000 ÷ 10000 hrs

The value of the budgeted overhead cost for 1 budgeted hours = $250 per standard hour

To get value of flexed Variable Overhead Budget = Actual Units × Budgeted overhead cost for standard hour

Let's substitute the values

= 9000 × 250

= $2,2500,000

Flexible-budget Variable Overhead Variance is gotten by subtracting the Variable overhead flexible budget and Actual Variable Overhead which we have as;

Flexible-budget Variable Overhead Variance = Variable overhead flexible budget - Actual Variable Overhead

= $2,2500,000 - $2,375,000

= $125,000

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.