Antuan Company set the following standard costs for one unit of its product.

Direct materials (4.0 Ibs. @ $5.00 per Ib.)	$	20.00
Direct labor (1.7 hrs. @ $12.00 per hr.)		20.40
Overhead (1.7 hrs. @ $18.50 per hr.)		31.45
Total standard cost	$	71.85

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	$	15,000
Indirect labor		75,000
Power		15,000
Repairs and maintenance		30,000
Total variable overhead costs				$	135,000
Fixed overhead costs
DepreciationBuilding		23,000
DepreciationMachinery		72,000
Taxes and insurance		18,000
Supervision		223,750
Total fixed overhead costs					336,750
Total overhead costs				$	471,750

The company incurred the following actual costs when it operated at 75% of capacity in October.

Direct materials (61,000 Ibs. @ $5.20 per lb.)				$	317,200
Direct labor (21,000 hrs. @ $12.20 per hr.)					256,200
Overhead costs
Indirect materials	$	41,200
Indirect labor		176,300
Power		17,250
Repairs and maintenance		34,500
DepreciationBuilding		23,000
DepreciationMachinery		97,200
Taxes and insurance		16,200
Supervision		223,750			629,400
Total costs				$	1,202,800

rev: 03_28_2018_QC_CS-122864

4. Compute the direct labor cost variance, including its rate and efficiency variances. AH = Actual Hours SH = Standard Hours AR = Actual Rate SR = Standard Rate

Standard Cost Actual Cost