EX 23-20. Factory overhead cost variance report Obj. 4 Tannin Products Inc. prepared the following factory overhead cost budget for the Trim Department for July of the current year, during which it expected to use 20,000 hours for production: Excel $46,000 12,000 20,000 $ 78,000 78,000 Variable overhead cost: Indirect factory labor Power and light Indirect materials Total variable overhead cost Fixed overhead cost: Supervisory salaries Depreciation of plant and equipment Insurance and property taxes Total fixed overhead cost Total factory overhead cost $54,500 40,000 35.500 130,000 $208,000 Tannin has available 25,000 hours of monthly productive capacity in the Trim Department under normal business conditions. During July, the Trim Department actually used 22,000 hours for production. The actual fixed costs were as budgeted. The actual variable overhead for July was as follows: Actual variable factory overhead cost: Indirect factory labor Power and light Indirect materials Total variable cost $49.700 13.000 24,000 $86,700 Construct a factory overhead cost variance report for the Trim Department for July. ANSWER! Alternative Computation of Overhead Variances: Factory Overhead Actual costs Balance Applied costs Actual Factory Overhead Applied Factory Overhead Budgeted Factory Overhead for Amount Produced Variable cost Fixed cost Total Controllable Variance Volume Variance Total Factory Overhead Cost Variance . Supporting calculation: Variable factory overhead rate: Budgeted total variable cost Budgeted hours Variable factory overhead rate Fixed factory overhead rate: Total fixed costs Productive capacity hours Fixed factory overhead rate Total Actual hours Applied costs