Direct materials 4.0 Ibs. @ $5.68 per Ib.) Direct labor (1.7 hrs. @ $13.00 per hr.) Overhead (1.7 hrs. @ $18.50 per hr.) Total standard cost $20.80 22.10 31.45 $73.55 The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factory's capacity of 20,000 units per month. Following are the company's budgeted overhead costs per month at the 75% capacity level. Overhead Budget (75% Capacity) Variable overhead costs Indirect materials $ 15,000 Indirect labor 75,00 Power 15,808 Repairs and maintenance 30,80 Total variable overhead costs Fixed overhead costs Depreciation-Building 24,806 Depreciation-Machinery 71,800 Taxes and insurance 17,600 Supervision 224,75 Total fixed overhead costs Total overhead costs $135,000 336,750 $471,750 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (61,000 lbs. @ $5.10 per 1b.) Direct labor (21,800 hrs. @ $13.30 per hr.) Overhead costs Indirect materials $ 311,100 279,300 $ 41,350 Required: 1&2. 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. ANTUAN COMPANY Flexible Overhead Budgets For Month Ended October 31 Flexible Budget Flexible Budget for Variable Amount Total Fixed 65% of 75% of 85% of Cost capacity capacity capacity 13,000 15,000 17,000 per Unit Sales (in units) Variable overhead costs Indirect materials $ 1.00 13,000 15,000 17,000 Indirect labor Power 1.00 13,000 26,000 15,000 30,000 17,000 34,000 Repairs and maintenance 2.00 Total variable costs $ 4.00 52,000 60,000 68,000 Fixed overhead costs $ Depreciation Building Depreciation Machinery Taxes and insurance 24,000 71,000 17,000 24,000 71,000 17,000 224,750 24,000 71,000 17,000 224,750 24,000 71,000 17,000 224,750 Supervision 224,750 Total fixed costs 336,750 336,750 336,750 336,750 Total overhead costs