Direct Materials, 2 feet at $8.45 per foot...$16.90

Direct Labor, 1.4 direct labor hours at $16 per direct labor hour..................22.40

Variable over head. 1.4 direct labor hours at $2.50 per direct labor hour.......3.50

Fixed over head, 1.4 direct labor hours at $6 per direct labor hour...8.40

Standard Cost per UnitTotal..$51.20

Company manufactured 30,000 units during year.

Total of 64,000 feet of material was purchased during the year at $8.55 per foot.

Company worked 43,500 direct labor hours, during the year at direct labor cost of $15.80 per hour.

Denominator Activity level( direct labor hours) ..35,000

Budgeted fixed over head cost$210,000

Actual variable over head cost incurred.$108,000

Actual fixed over head cost incurred$211,800

1.

a. Variable overhead spending and efficiency variances:

Actual Hours of Input, at the Actual Rate

Actual Hours of Input, at the Standard Rate

Standard Hours Allowed for Output, at the Standard Rate

(AH AR)

(AH SR)

(SH SR)

$108,000 (given in textbook)

xxx,x00 DLHs $2.50 per DLH

xx,000 DLHs $x.50 per DLH

= $xxx,xxx

= $xxx,000

Rate Variance = $xxx F

Efficiency Variance = $x,xxx U

Alternative solution:

Variable overhead rate variance = (AH AR) (AH SR)

($xxx,000) (xx,x00 DLHs $2.50 per DLH) = $xxx F

Variable overhead efficiency variance = SR (AH SH)

$x.xx per DLH (xx,x00 DLHs xx,000 DLHs) = $x,xxx U