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Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2017. Costs and Production Data Actual Standard Raw

Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2017.

Costs and Production Data

Actual

Standard

Raw materials unit cost$2.25$2.10Raw materials units used10,60010,000Direct labor payroll$120,960$120,000Direct labor hours worked14,40015,000Manufacturing overhead incurred$189,500Manufacturing overhead applied$193,500Machine hours expected to be used at normal capacity42,500Budgeted fixed overhead for June$55,250Variable overhead rate per machine hour$3.00Fixed overhead rate per machine hour$1.30

Overhead is applied on the basis of standard machine hours.3.00hours of machine time are required for each direct labor hour. The jobs were sold for $400,000. Selling and administrative expenses were $40,000. Assume that the amount of raw materials purchased equaled the amount used.

Compute the overhead controllable variance and the overhead volume variance.

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