Antuan Company set the following standard costs for one unit of its product Direct materials (3.8 Ibs. @ $6.00 per Ib.) Direct labor (1.7 hrs. @ $13.00 per hr.) Overhead (1.7 hrs. @ $18.50 per hr.) Total standard cost $18.00 22.10 31.45 $71.55 The predetermined overhead rate ($18.50 per direct labor houn is based on an expected volume of 75% of the factory's capacity of 20,000 units per month. Following are the company's budgeted overhead costs per month at the 75% capacity level Overhead Budget (75% Capacity Variable overhead costs Indirect materials $ 15,000 Indirect labor 75,000 Power 15,000 Repairs and maintenance 30,000 Total variable overhead costs Fixed overhead costs Depreciation-Building 24,000 Depreciation Machinery 71,00 Taxes and insurance 17,000 Supervision 224750 Total fixed overhead costs Total overhead costs $135,000 336,750 $474,750 The company incurred the following actual costs when it operated at 75% of capacity in October $ 280,600 266,000 Direct materials (46,000 lbs. @ $6.10 per lb.) Direct labor (20,000 hrs. @ $13.30 per hr.) Overhead costs Indirect materials Indirect labor Power Repairs and maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervision Total costs $ 41,350 176, 100 17,250 34,500 24,000 95,850 15,300 224,730 $29,100 $1,175,700 3. Compute the direct materials cost variance, including its price and quantity variances (Indicate the effect of each varience by selecting for favorable, unfavorable, and No variance.) Actual Cost Actual quantity X 46,000 x Actual price X Standard price Actual quantity 46.000 Standard cost Standard quantity X 45,000 X x $ 0 $ 0 Direct materials price variance Direct materials quantity variance Total direct materials variance 1. Compute the direct labor cost variance, including its rate and efficiency variances. (Indicate the effect of each variance by electing for favorable, unfavorable, and No variance. Round "Rate per hour" answers to two decimal places.) Achal Cost Actual hours x X Actual rate 1330 Standard hours 20.000 Actual hours 20.000 Standard rate 1300 X $ x 5 x $ 266,000 $ 260,000 55,000 0 5 Direct laborate variance Direct labor efficiency variance Total variable overhead cool variance 6.000 0 Varinne ny seIPTIN TOT TAVOTA IR INTAVOTnnie AND VArinncei ! Required information Overhead Variance Report For Month Ended October 31 Expected production volume Production level achieved Volume variance Flexible Budget Actual Results Variances Fav. / Unfav. Variable costs Fixed costs
