Audrina'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 direct batch-level costs and fixed batch-level overhead costs. The following information pertains to shipping costs for

2014.

1.

2.

What is the flexible budget number of crates for

2014?

3.

What is the actual number of crates shipped in

2014?

4.

Assuming fixed overhead is allocated using crate-packing hours, what is the predetermined fixed overhead allocation rate?

5.

For variable direct batch-level costs, compute the price and efficiency variances.

6.

	Static-Budget Amounts			Actual Results
Pairs of shoes shipped		240,000		180,000
Average number of pairs of shoes per crate		12		10
Packing hours per crate		1.2 hours		1.1 hours
Variable direct cost per hour		$20		$21
Fixed overhead cost		$60,000		$62,500

For fixed overhead costs, compute the spending and the production-volume variances.