Rica’s Fleet Feet, Inc., produces dance shoes for stores all over the world. While the pairs of shoes are boxed individually, they are crated and shipped in batches. The shipping department records both variable and fixed overhead costs. The following information pertains to shipping costs for 2008.

Static-Budget Amt’s Actual Results
Pairs of shoes shipped 240,000 180
Avg # of pairs of shoes per crate 12 10
Packing hours per crate 1.2 1.1
Variable OH cost / hour $20 $21
Fixed OH cost $60,000 $55,000

1. What is the static budget number of crates for 2008?
2. What is the flexible budget number of crates for 2008?
3. What is the actual number of crates shipped in 2008?
4. Assuming fixed OH is allocated using crate-packing hours, what is the predetermined fixed overhead allocation rate?
5. For variable OH costs, compute the spending and efficiency variances.
6. For fixed OH costs, compute the spending and production-volume variances.

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