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Antuan Company set the following standard costs for one unit of its product. Direct materials (4.0 Ibs. @ $4.00 per Ib.) $ 16.00 Direct labor

Antuan Company set the following standard costs for one unit of its product.
Direct materials (4.0 Ibs. @ $4.00 per Ib.) $ 16.00
Direct labor (1.8 hrs. @ $12.00 per hr.) 21.60
Overhead (1.8 hrs. @ $18.50 per hr.) 33.30
Total standard cost $ 70.90

The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factorys capacity of 20,000 units per month. Following are the companys budgeted overhead costs per month at the 75% capacity level.

Overhead Budget (75% Capacity)
Variable overhead costs
Indirect materials $ 30,000
Indirect labor 75,000
Power 30,000
Repairs and maintenance 30,000
Total variable overhead costs $ 165,000
Fixed overhead costs
Depreciationbuilding 23,000
Depreciationmachinery 72,000
Taxes and insurance 17,000
Supervision 222,500
Total fixed overhead costs 334,500
Total overhead costs $ 499,500
The company incurred the following actual costs when it operated at 75% of capacity in October.
Direct materials (61,500 Ibs. @ $4.10 per lb.) $ 252,150
Direct labor (28,000 hrs. @ $12.20 per hr.) 341,600
Overhead costs
Indirect materials $ 41,600
Indirect labor 176,000
Power 34,500
Repairs and maintenance 34,500
Depreciationbuilding 23,000
Depreciationmachinery 97,200
Taxes and insurance 15,300
Supervision 222,500 644,600
Total costs $ 1,238,350

1. Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels and classify all items listed in the fixed budget as variable or fixed

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2. Calculate the direct materials cost variance, including its price and quantity variances.

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ANTUAN COMPANY Flexible Overhead Budgets For Month Ended October 31 Flexible Budget Flexible Budget for Variable Amount par Uni Total Fixed Cost 65% of capac 75% of capac 85% of capac Sales (in units) Variable overhead costs Fixed overhead costs Total overhead costs

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