Patel and Suns, Inc., uses a standard cost system to apply overhead costs to units produced. The practical capacity for the plant is defined as 55,800 machine hours per year, which represents 27,900 units of output. Annual budgeted fixed overhead costs are $279,000 and the budgeted variable overhead cost rate is $3.90 per unit. Factory overhead costs are applied based on standard machine-hours allowed for units produced. The budgeted and actual output for the year was 21,700 units, which took 44,800 machine hours. Actual fixed overhead costs for the year amounted to $272,000 while the actual variable overhead cost per unit was $3.80.1. Based on the information provided above, what was the fixed overhead spending (budget) variance for the year?2. What was the fixed overhead production volume variance for the year? (Do not round intermediate calculations. The round final answer to the nearest whole dollar amount.)3) Based on the information provided above, what was the variable overhead spending variance for the year? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.)4. What was the variable overhead efficiency variance for the year? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.)5) Based on the information provided above, provide the correct summary journal entries for actual and applied overhead costs (both variable and fixed) for the year. Assume that the company uses a single account, Factory Overhead, to record both actual and applied overhead. Also, assume that the only variable overhead cost was electricity and that actual fixed overhead consisted of depreciation of $170,000 and supervisory salaries of $97,000. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select “No journal entry required” in the first account field.)6) Based on the information provided above, provide the appropriate journal entries: (a) to record the overhead cost variances for the period (thereby closing out the balance in the Factory Overhead account), and (b) to close the variance accounts to the CGS account at the end of the period. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select “No journal entry required” in the first account field.)7) Assume that at the end of the year management of Patel and Suns, Inc., decides that the overhead cost variances should be allocated to WIP Inventory, Finished Goods Inventory, and CGS using the following percentages: 10%, 20%, and 70%, respectively. Provide the proper journal entry to close out the manufacturing overhead variances for the year. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select “No journal entry required” in the first account field.)
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